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Timothy  Dwight,  D.D.  LLD. 
Richard  HenryStoddard 
Arthvr  Richmond  Marsh,  A.B. 
Pavl  van  Dyke,  D.D. 
Albert  Ellery  Bergh 


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PRINCIPLES  OF 
POLITICAL  ECONOMY 

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SOCIAL  PHILOSOPHY 

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JOHN  STUART  MILL 


WITH  A  SPECIAL  INTRODUCTION  BY 

ARTHUR  T.  HADLEY,  LL.D. 

PRESIDENT  OF  YALE  UNIVERSITY;  UNTIL  1899, 
PROFESSOR  OF  POLITICAL  ECONOMY 

REVISED  EDITION 

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SPECIAL  INTRODUCTION 


THERE  are  very  few  scientific  books  whose  permanent 
place  in  literature  seems  so  well  established  as  that 
of  John  Stuart  Mill’s  “  Principles  of  Political  Econ¬ 
omy.”  Even  though  it  be  true  that  Adam  Smith  was  a  more 
suggestive  writer,  Malthus  a  more  original  one,  Ricardo  a  more 
logical  one — the  fact  yet  remains  that  Mill  knew  how  to  sum 
up  the  discoveries  of  all  three,  and  give  them  coherence  in  the 
popular  mind.  His  greatness  lay  not  in  the  discovery  of  new 
truths  for  future  generations,  but  in  the  full  expression  of 
present  truths  on  which  the  men  of  his  own  generation  ivere 
relying.  Whatever  changes  may  be  made  in  economic  theory 
as  a  whole,  Mill’s  book  will  always  have  monumental  impor¬ 
tance  as  a  record  of  the  particular  economic  theories  which 
inspired  the  political  development  of  the  first  half  of  the  nine¬ 
teenth  century.  Whatever  we  may  think  of  its  soundness  as 
an  analysis  of  human  conduct,  there  can  be  no  question  of  its 
surpassing  value  as  a  historic  document.  Perhaps  it  gives 
an  imperfect  or  false  picture  of  the  way  in  which  men  act ; 
but  there  is  no  doubt  that  it  gives  a  wondrously  perfect  and 
true  picture  of  the  way  in  which  intelligent  men  in  the  middle 
of  the  nineteenth  century  supposed  themselves  to  act. 

The  best  introduction  to  Mill’s  book  is  an  account  of  the 
influences  under  which  it  was  conceived.  For,  just  as  the 
Elizabethan  drama  depended  on  its  audience  for  no  small  part 
of  its  inspiration,  and  reflected  in  its  character  the  spirit  of 
Drake  and  Raleigh,  no  less  than  that  of  Marlowe  or  Shake¬ 
speare,  so  the  Victorian  economics  was  inspired  by  the  nine¬ 
teenth-century  English  public  and  reflected  the  spirit  of  those 
statesmen,  who  in  the  first  half  of  that  century,  had  laid  the 
foundation  for  English  commercial  empire. 

Mill’s  “Political  Economy  ”  was  issued  in  1848.  Not  quite 
three-quarters  of  a  century  had  elapsed  since  the  appearance 
of  the  only  other  book  on  the  same  subject  which  has  rivalled  it 

iii 


IV 


POLITICAL  ECONOMY 


in  public  influence — Adam  Smith’s  “  Wealth  of  Nations.”  The 
contrast  between  the  two  books  is  instructive;  all  the  more 
so  because  of  a  certain  similarity  of  character  between  their 
authors.  Both  Mill  and  Smith  combined  the  training  of  the 
philosopher  with  the  taste  for  practical  affairs.  Each  valued 
theory  as  a  means  of  influencing  political  and  commercial  ac¬ 
tivity;  each,  in  studying  the  motives  for  such  activity,  found 
that  his  theory  gave  him  a  wider  vision  than  that  of  his  fellow- 
men.  But  Smith’s  vision  was  that  of  the  prophet ;  Mill’s,  that 
of  the  philosophic  historian.  Smith  was  forced  to  prepare  a 
way  for  his  theories ;  Mill  spoke  to  an  audience  prepared  to 
welcome  such  theories  as  the  embodiment  of  human  wisdom. 
Since  Smith’s  day,  his  reasonings  had  been  worked  out  in  prac¬ 
tice  by  two  generations  of  English  statesmen ;  they  had  formed 
the  basis  of  the  activity  of  men  like  Canning  and  Huskisson, 
Cobden  and  Peel ;  they  had  been  verified  by  legislative  suc¬ 
cesses  of  unexampled  brilliancy.  Among  the  champions  of 
this  progress  Mill’s  whole  life  had  been  passed.  His  father 
had  been  a  leader  of  the  first  generation;  he  himself  had 
fought  in  all  the  battles  of  the  second,  and  had  been  honor¬ 
ably  associated  with  its  political  life.  He  had  been  a  participant 
in  that  great  struggle  which  resulted  in  the  abolition  of  an 
erroneous  system  of  public  charity;  in  a  reform  which  had 
placed  the  national  currency  on  a  sound  basis ;  in  the  estab¬ 
lishment  of  free  trade  as  England’s  fundamental  policy  ;  and 
in  the  development  of  a  system  of  colonial  empire  more  en¬ 
lightened  in  principle  and  more  beneficent  in  its  results  than 
any  which  the  world  had  ever  seen.  To  an  audience  dazzled 
by  these  successes  came  John  Stuart  Mill,  accredited  by  the 
share  which  he  had  already  borne  in  producing  them,  and  still 
more  decisively  accredited  by  his  success  in  formulating  the 
ideas  which  underlay  these  political  movements  as  part  of 
a  comprehensive  scheme  of  social  philosophy. 

It  was  a  dangerous  position  for  a  mortal  man  to  hold.  Had 
Mill  been  less  great,  it  would  probably  have  destroyed  his 
chances  of  permanent  influence.  The  man  who  is  the  uni¬ 
versally  accredited  master  of  one  generation  is  apt  to  be  cor¬ 
respondingly  discredited  in  the  next — perhaps  even  more  so 
than  he  deserves.  The  same  age  and  conditions  which  pro¬ 
duced  a  Mill  in  political  economy,  produced  a  Mendelssohn  in 
music  and  a  Macaulay  in  belles-lettres ;  men  who  knew  almost 


SPECIAL  INTRODUCTION 


v 


everything  which  the  past  had  to  give,  and  suspected  little  or 
nothing  of  the  future.  “  I  only  wish  I  were  as  cocksure  of 
anything  as  Tom  Macaulay  is  of  everything,”  sighed  old  Lord 
Melbourne,  who  had  seen  too  many  things  to  believe  that  all 
the  wisdom  of  the  world  was  culminating  in  a  single  genera¬ 
tion.  The  future  has  wreaked  its  revenge  on  those  who  tried 
to  ignore  it.  Mendelssohn  is  perhaps  as  much  underestimated 
as  he  once  was  overestimated ;  Macaulay’s  cocksureness  has 
led  people  to  apply  to  his  writings  the  well-known  epigram, 
“  Other  things  being  equal,  I  always  prefer  a  lively  liar  to  a  dull 
one.” 

Mill  treated  the  future  with  more  respect  and  has  received 
correspondingly  better  treatment  from  it  in  return.  There  are 
few  men,  indeed,  who  have  stood  the  test  of  popularity  as  well 
as  he.  He  was  preserved  from  its  most  insidious  dangers  by 
possessing  in  the  very  highest  degree  the  two  qualities  of 
reverence  and  sympathy.  A  course  of  education  such  as  is 
described  in  his  “  Autobiography,”  which  with  a  lesser  man 
might  have  stifled  both  these  feelings,  served,  with  him,  only 
to  make  them  more  independent  of  external  circumstances.  His 
sympathy  kept  him  from  complacent  optimism ;  his  reverence 
prevented  him  from  being  puffed  up  by  the  flattery  of  any 
human  audience  or  from  accepting  its  judgments  as  final.  And 
if,  here  and  there,  the  book  is  marked  by  a  somewhat  magisterial 
tone — as  in  the  celebrated  passage  where  its  author  says  that 
in  the  fundamental  laws  of  value  there  is  little  or  nothing  left 
for  subsequent  writers  to  remodel — the  wonder  is,  not  that  such 
assumptions  of  authority  should  occur,  but  that  they  should 
occur  so  rarely. 

While  thus  avoiding  many  of  the  temptations  incident  to 
his  position  as  a  master,  Mill  was  able  to  make  good  use  of 
its  advantages.  He  has  the  sureness  of  touch  of  a  man  who 
knows  his  audience.  He  does  not  have  to  begin,  as  did  Adam 
Smith,  with  historical  disquisitions  which  would  prepare  the 
minds  of  his  readers  for  the  strong  meat  of  his  system.  He 
finds  them  at  once  prepared  and  hungry.  The  conception  of 
public  or  national  wealth,  which  Smith  had  to  create,  lies 
ready  at  Mill’s  hand  for  analysis.  To  Smith’s  readers,  wealth 
naturally  meant  a  sum  of  money  values ;  and  he  has  to  take 
constant  pains  to  disabuse  them  of  this  idea.  To  Mill’s  readers, 
it  means  something  much  more  than  this.  Familiar  as  they 


VI 


POLITICAL  ECONOMY 


are  with  the  masterly  speeches  of  Peel  and  Cobden,  they  have 
been  taught  to  distrust  the  purely  mercantile  theories  of  na¬ 
tional  policy,  and  to  regard  the  nation’s  wealth  as  an  aggregate 
of  commodities  available  for  human  happiness.  How  these 
commodities  are  produced,  how  they  are  distributed,  how  they 
are  exchanged — these  are  the  topics  which  form  the  theme  of 
Mill’s  investigation.  He  had  but  to  analyze  data  which  were 
given  him  by  the  dominant  social  philosophy  of  England  in  his 
day.  He  brought  to  this  analysis  not  only  a  power  of  arrange¬ 
ment  but  also  a  breadth  of  view  superior  to  that  of  any  of  his 
contemporaries ;  yet  it  was  from  those  contemporaries  that  he 
took  without  question  the  conceptions  with  which  he  dealt.  His 
predicates  were  his  own;  his  subjects  were,  for  the  most  part, 
taken  from  the  current  and  almost  commonplace  thought  of  his 
day. 

How  strong  and  at  the  same  time  how  subtle  was  the  in¬ 
fluence  of  those  current  conceptions  can  perhaps  best  be  seen 
in  the  works  of  men  who,  like  Carlyle  or  Kingsley,  at¬ 
tempted  to  take  a  position  hostile  to  Mill.  Underlying  the 
thought  of  these  writers,  there  is  the  sound  and  healthful  idea 
that  material  wealth  ought  not  to  be  elevated  to  the  position 
of  an  independent  entity,  dissevered  from  the  happiness  of 
those  who  are  to  enjoy  it.  But  it  would  seem  that  neither  of 
them  really  formulated  this  protest  in  valid  shape.  Instead 
of  rejecting  Mill’s  conceptions,  they  inveighed  against  his 
conclusions.  Like  him,  they  took  their  subjects  ready  made; 
like  him  they  made  their  own  predicates ;  but,  being  possessed 
of  less  than  his  power  in  logic  and  patience  in  study,  their 
predicates  were  less  correct  than  his.  And  what  is  seen  in 
Kingsley  or  Carlyle  is  seen  also  in  Lassalle  and  Marx. 

Nearly  a  generation  elapsed  before  any  very  vital  criticism 
was  directed  against  Mill’s  methods  and  assumptions.  It  is 
true  that  the  writers  of  the  “  historical  school,  ”  first  in  Ger¬ 
many  and  then  in  England  and  America,  made  great  show 
of  protest.  But  their  divergence  from  Mill  was  far  less  than 
appeared  on  the  surface.  They  complained  that  Mill  had  taken 
certain  institutions  and  modes  of  action  peculiar  to  his  day, 
and  treated  them  as  though  they  existed  for  all  time.  A  very 
able  example  of  this  sort  of  criticism  is  Bagehot’s  “  Postulates 
of  English  Political  Economy.”  But  this  does  not  go  to  the 
root  of  the  matter.  The  weak  point  in  the  political  economy 


SPECIAL  INTRODUCTION 


vu 

of  Mill’s  day  was  not  so  much  that  it  treated  particular  forms 
of  wealth  as  absolute  and  independent  subjects  of  thought; 
but  that  it  treated  any  form  of  wealth  in  this  way.  The  first 
real  forward  step  was  taken  by  Jevons  and  his  contemporaries ; 
who  analyzed,  not  a  supposed  inherent  utility  of  things,  but 
the  conditions  of  their  utility  to  man  as  a  living  being.  In 
the  twenty-eight  years  that  have  elapsed  since  the  appearance 
of  Jevons’s  “  Theory  of  Political  Economy,”  this  has  been  a 
dominant  and  distinctive  note  in  the  work  of  the  younger  in¬ 
vestigators  ;  and  it  has  given  to  their  analysis  new  inspiration 
and  new  breadth  of  treatment. 

Nevertheless  there  is  no  book  by  any  of  these  younger  men 
which  can  be  said  to  have  displaced  Mill.  Their  work  is  still 
in  the  formative  period.  It  has  the  virtues  of  growth ;  it  also 
has  its  vices.  “  Es  irrt  der  Mensch,  so  lang  er  strebt  ” — in  other 
words,  effort  for  something  better  involves  a  good  many  pos¬ 
sibilities  of  missing  the  road  before  you  attain  it.  No  modern 
writer  on  economics  has  either  Mill’s  repose  or  Mill’s  sureness 
of  touch.  Those  who  seek  the  most  recent  discoveries,  the 
profoundest  suggestions  of  future  possibilities  of  development, 
seek  them  elsewhere  than  in  Mill.  But  for  that  larger  number 
of  readers  who  are  not  ambitious  to  become  explorers ;  who 
prefer  to  tread  the  old  paths  until  they  are  sure  which  of  the 
new  ones  will  lead  them  to  their  destination;  who  want  the 
conclusions  of  the  fathers  rather  than  the  speculations  of  the 
sons — Mill’s  “Principles  of  Political  Economy  ”  still  holds  its 
place  of  authority. 


MILL’S  PREFACE 


THE  appearance  of  a  treatise  like  the  present,  on  a  subject 
on  which  so  many  works  of  merit  already  exist,  may  be 
thought  to  require  some  explanation. 

It  might  perhaps  be  sufficient  to  say,  that  no  existing  treatise 
on  Political  Economy  contains  the  latest  improvements  whicn 
have  been  made  in  the  theory  of  the  subject.  Many  new  ideas, 
and  new  applications  of  ideas,  have  been  elicited  by  the  discus¬ 
sions  of  the  last  few  years,  especially  those  on  Currency,  on 
Foreign  Trade,  and  on  the  important  topics  connected  more 
or  less  intimately  with  Colonization:  and  there  seems  reason 
that  the  field  of  Political  Economy  should  be  resurveyed  in  its 
whole  extent,  if  only  for  the  purpose  of  incorporating  the  re¬ 
sults  of  these  speculations,  and  bringing  them  into  harmony 
with  the  principles  previously  laid  down  by  the  best  thinkers 
on  the  subject. 

To  supply,  however,  these  deficiencies  in  former  treatises 
bearing  a  similar  title,  is  not  the  sole,  or  even  the  principal  ob¬ 
ject  which  the  author  has  in  view.  The  design  of  the  book  is 
different  from  that  of  any  treatise  on  Political  Economy  which 
has  been  produced  in  England  since  the  work  of  Adam  Smith. 

The  most  characteristic  quality  of  that  work,  and  the  one  in 
which  it  most  differs  from  some  others  which  have  equalled 
and  even  surpassed  it  as  mere  expositions  of  the  general  prin¬ 
ciples  of  the  subject,  is  that  it  invariably  associates  the  prin¬ 
ciples  with  their  applications.  This  of  itself  implies  a  much 
wider  range  of  ideas  and  of  topics,  than  are  included  in  Polit¬ 
ical  Economy,  considered  as  a  branch  of  abstract  speculation. 
For  practical  purposes,  Political  Economy  is  inseparably  inter¬ 
twined  with  many  other  branches  of  social  philosophy.  Except 
on  matters  of  mere  detail,  there  are  perhaps  no  practical  ques¬ 
tions,  even  among  those  which  approach  nearest  to  the  charac¬ 
ter  of  purely  economical  questions,  which  admit  of  being  de¬ 
cided  on  economical  premises  alone.  And  it  is  because  Adam 


IX 


X 


PREFACE 


Smith  never  loses  sight  of  this  truth;  because,  in  his  applica¬ 
tions  of  Political  Economy,  he  perpetually  appeals  to  other  and 
often  far  larger  considerations  than  pure  Political  Economy 
affords — that  he  gives  that  well-grounded  feeling  of  command 
over  the  principles  of  the  subject  for  purposes  of  practice,  ow¬ 
ing  to  which  the  “  Wealth  of  Nations,”  alone  among  treatises 
on  Political  Economy,  has  not  only  been  popular  with  general 
readers,  but  has  impressed  itself  strongly  on  the  minds  of  men 
of  the  world  and  of  legislators. 

It  appears  to  the  present  writer,  that  a  work  similar  in  its  ob¬ 
ject  and  general  conception  to  that  of  Adam  Smith,  but  adapted 
to  the  more  extended  knowledge  and  improved  ideas  of  the 
present  age,  is  the  kind  of  contribution  which  Political  Economy 
at  present  requires.  The  “  Wealth  of  Nations  ”  is  in  many 
parts  obsolete,  and  in  all,  imperfect.  Political  Economy,  prop¬ 
erly  so  called,  has  grown  up  almost  from  infancy  since  the  time 
of  Adam  Smith :  and  the  philosophy  of  society,  from  which 
practically  that  eminent  thinker  never  separated  his  more  pe¬ 
culiar  theme,  though  still  in  a  very  early  stage  of  its  progress, 
has  advanced  many  steps  beyond  the  point  at  which  he  left  it. 
No  attempt,  however,  has  yet  been  made  to  combine  his  prac¬ 
tical  mode  of  treating  his  subject  with  the  increased  knowledge 
since  acquired  of  its  theory,  or  to  exhibit  the  economical  phe¬ 
nomena  of  society  in  the  relation  in  which  they  stand  to  the 
best  social  ideas  of  the  present  time,  as  he  did,  with  such  ad¬ 
mirable  success,  in  reference  to  the  philosophy  of  his  century. 

Such  is  the  idea  which  the  writer  of  the  present  work  has 
kept  before  him.  To  succeed  even  partially  in  realizing  it, 
would  be  a  sufficiently  useful  achievement,  to  induce  him  to 
incur  willingly  all  the  chances  of  failure.  It  is  requisite,  how¬ 
ever,  to  add,  that  although  his  object  is  practical,  and,  as  far 
as  the  nature  of  the  subject  admits,  popular,  he  has  not  at¬ 
tempted  to  purchase  either  of  those  advantages  by  the  sacrifice 
of  strict  scientific  reasoning.  Though  he  desires  that  his  trea¬ 
tise  should  be  more  than  a  mere  exposition  of  the  abstract  doc¬ 
trines  of  Political  Economy,  he  is  also  desirous  that  such  an 
exposition  should  be  found  in  it. 


CONTENTS 


PAGE 

Preliminary  Remarks .  i 

BOOK  I 

PRODUCTION 

Chapter  I.  Of  the  Requisites  of  Production. 

1.  Requisites  of  production,  what .  23 

2.  The  function  of  labor  defined .  24 

3.  Does  nature  contribute  more  to  the  efficacy  of  labor  in  some 

occupations  than  in  others? .  26 

4.  Some  natural  agents  limited,  others  practically  unlimited,  in 

quantity  .  27 

Chapter  II.  Of  Labor  as  an  Agent  of  Production. 

1.  Labor  employed  either  directly  about  the  thing  produced,  or  in 

operations  preparatory  to  its  production .  29 

2.  Labor  employed  in  producing  subsistence  for  subsequent  la¬ 

bor .  31 

3.  — in  producing  materials .  33 

4.  —  or  implements  .  35 

5.  — in  the  protection  of  labor .  36 

6.  — in  the  transport  and  distribution  of  the  produce .  37 

7.  Labor  which  relates  to  human  beings .  40 

8.  Labor  of  invention  and  discovery .  41 

9.  Labor  agricultural,  manufacturing,  and  commercial .  42 

Chapter  III.  Of  Unproductive  Labor. 

1.  Labor  does  not  produce  objects,  but  utilities .  44 

2.  — which  are  of  three  kinds .  45 

3.  Productive  labor  is  that  which  produces  utilities  fixed  and  em¬ 

bodied  in  material  objects .  47 

4.  All  other  labor,  however  useful,  is  classed  as  unproductive.  .  49 

5.  Productive  and  Unproductive  Consumption .  51 

6.  Labor  for  the  supply  of  Productive  Consumption,  and  labor 

for  the  supply  of  Unproductive  Consumption .  52 

Chapter  IV.  Of  Capital. 

1.  Capital  is  wealth  appropriated  to  reproductive  employment. .  54 

2.  More  capital  devoted  to  production  than  actually  employed 

in  it  .  56 

3.  Examination  of  some  cases  illustrative  of  the  idea  of  capital.  .  59 

xi 


xii  MILL 

Chapter  V.  Fundamental  Propositions  respecting  Capital.  PAGH 

1.  Industry  is  limited  by  Capital .  62 

2.  —  but  does  not  always  come  up  to  that  limit .  64 

3.  Increase  of  capital  gives  increased  employment  to  labor,  with¬ 

out  assignable  bounds .  65 

4.  Capital  is  the  result  of  saving .  68 

5.  All  capital  is  consumed .  70 

6.  Capital  is  kept  up,  not  by  preservation,  but  by  perpetual  repro¬ 

duction  .  73 

7.  Why  countries  recover  rapidly  from  a  state  of  devastation. ..  .74 

8.  Effects  of  defraying  government  expenditure  by  loans .  75 

9.  Demand  for  commodities  is  not  demand  for  labor .  78 

10.  Fallacy  respecting  Taxation .  88 

Chapter  VI.  On  Circulating  and  Fixed  Capital. 

1.  Fixed  and  Circulating  Capital,  what .  90 

2.  Increase  of  fixed  capital,  when  at  the  expense  of  circulating, 

might  be  detrimental  to  the  laborers .  92 

3.  —  but  this  seldom  if  ever  occurs .  96 

Chapter  VII.  On  what  depends  the  degree  of  Productiveness 
of  Productive  Agents. 

1.  Land,  labor,  and  capital,  are  of  different  productiveness  at 

different  times  and  places .  99 

2.  Causes  of  superior  productiveness.  Natural  advantages .  100 

3.  — greater  energy  of  labor .  102 

4.  — superior  skill  and  knowledge .  104 

5.  —  superiority  of  intelligence  and  trustworthiness  in  the  com¬ 

munity  generally .  106 

6.  — superior  security  .  in 

Chapter  VIII.  Of  Co-operation,  or  the  Combination  of  Labor. 

1.  Combination  of  Labor  a  principal  cause  of  superior  produc¬ 

tiveness  .  1 13 

2.  Effects  of  separation  of  employments  analyzed .  115 

3.  Combination  of  labor  between  town  and  country .  118 

4.  The  higher  degrees  of  the  division  of  labor .  120 

5.  Analysis  of  its  advantages .  121 

6.  Limitations  of  the  division  of  labor .  128 

Chapter  IX.  Of  Production  on  a  Large,  and  Production  on  a 
Small  Scale. 

1.  Advantages  of  the  large  system  of  production  in  manu¬ 

factures  . 129 

2.  Advantages  and  disadvantages  of  the  joint-stock  principle...  134 

3.  Conditions  necessary  for  the  large  system  of  production....  139 

4.  Large  and  small  farming  compared . .  142 

Chapter  X.  Of  the  Law  of  the  Increase  of  Labor. 

I.  The  law  of  the  increase  of  production  depends  on  those  of 

three  elements,  Labor,  Capital,  and  Land .  152 


CONTENTS 


• « * 

xm 

PAGE 

2.  The  Law  of  Population .  153 

3.  By  what  checks  the  increase  of  population  is  practically 

limited  .  155 

Chapter  XI.  Of  the  Law  of  the  Increase  of  Capital. 

1.  Means  and  motives  to  saving,  on  what  dependent .  159 

2.  Causes  of  diversity  in  the  effective  strength  of  the  desire  of 

accumulation  .  161 

3.  Examples  of  deficiency  in  the  strength  of  this  desire .  163 

4.  Exemplification  of  its  excess .  170 

Chapter  XII.  Of  the  Law  of  the  Increase  of  Production  from 
Land. 

1.  The  limited  quantity  and  limited  productiveness  of  land,  the 

real  limits  to  production .  173 

2.  The  law  of  production  from  the  soil,  a  law  of  diminishing 

return  in  proportion  to  the  increased  application  of  labor 
and  capital  .  173 

3.  Antagonist  principle  to  the  law  of  diminishing  return ;  the 

progress  of  improvements  in  production .  177 

Chapter  XIII.  Consequence  of  the  foregoing  Laws. 

1.  Remedies  when  the  limit  to  production  is  the  weakness  of 

the  principle  of  accumulation .  186 

2.  Necessity  of  restraining  population  not  confined  to  a  state  of 

inequality  of  property .  187 

3.  —  nor  superseded  by.  free  trade  in  food .  190 

4.  —  nor  in  general  by  emigration .  194 

BOOK  II 

DISTRIBUTION 

Chapter  I.  Of  Property. 

1.  Introductory  remarks .  196 

2.  Statement  of  the  question .  198 

3.  Examination  of  Communism .  200 

4.  Examination  of  St.  Simonism  and  Fourierism .  208 

Chapter  II.  The  same  subject  continued. 

1.  The  institution  of  property  implies  freedom  of  acquisition  by 

contract  . 213 

2.  —  the  validity  of  prescription .  214 

3.  —  the  power  of  bequest,  but  not  the  right  of  inheritance. 

Question  of  inheritance  examined .  215 

4.  Should  the  right  of  bequest  be  limited,  and  how? .  221 

5.  Grounds  of  property  in  land,  different  from  those  of  property 

in  movables  .  224 

6.  —  only  valid  on  certain  conditions,  which  are  not  always  real¬ 

ized.  The  limitations  considered .  226 

7.  Rights  of  property  in  abuses .  230 


XIV 


MILL 


Chapter  III.  Of  the  Classes  among  whom  the  Produce  is  dis¬ 
tributed.  PAGE 

1.  The  produce  sometimes  shared  among  three  classes .  231 

2.  The  produce  sometimes  belongs  undividedly  to  one . 232 

3.  The  produce  sometimes  divided  between  two . 233 

Chapter  IV.  Of  Competition  and  Custom. 

1.  Competition  not  the  sole  regulator  of  the  division  of  the 

produce  .  235 

2.  Influence  of  custom  on  rents,  and  on  the  tenure  of  land . 236 

3.  Influence  of  custom  on  prices .  239 

Chapter  V.  Of  Slavery. 

1.  Slavery  considered  in  relation  to  the  slaves .  241 

2.  Slavery  in  relation  to  production .  242 

3.  Emancipation  considered  in  relation  to  the  interest  of  the 

slave-owners  .  245 

Chapter  VI.  Of  Peasant  Proprietors. 

1.  Difference  between  English  and  Continental  opinions  respect¬ 

ing  peasant  properties .  246 

2.  Evidence  respecting  peasant  properties  in  Switzerland .  248 

3.  —  in  Norway .  253 

4.  —  in  Germany  . 256 

5.  —  in  Belgium  . 261 

6.  — in  the  Channel  Islands .  266 

7.  —  in  France  . • .  268 

Chapter  VII.  Continuation  of  the  same  subject. 

1.  Influence  of  peasant  properties  in  stimulating  industry . 272 

2.  —  in  training  intelligence .  275 

3.  — in  promoting  forethought  and  self-control .  276 

4.  Their  effect  on  population .  277 

5.  Their  effect  on  the  subdivision  of  land .  285 

Chapter  VIII.  Of  Metayers. 

1.  Nature  of  the  metayer  system,  and  its  varieties .  289 

2.  Its  advantages  and  inconveniences .  291 

3.  Evidence  concerning  its  effects  in  different  countries . 294 

4.  Is  its  abolition  desirable? .  303 

Chapter  IX.  Of  Cottiers. 

1.  Nature  and  operation  of  cottier  tenure . 305 

2.  In  an  overpeopled  country  its  necessary  consequence  is  nomi¬ 

nal  rents .  308 

3.  —  which  are  inconsistent  with  industry,  frugality,  or  restraint 

on  population .  310 

4.  Ryot  tenancy  of  India .  312 

Chapter  X.  Means  of  abolishing  Cottier  Tenancy. 

1.  Irish  cottiers  should  be  converted  into  peasant  proprietors _ 315 

2.  Present  state  of  this  question . 323 


CONTENTS 


xv 


Chapter  XI.  Of  Wages.  PAGE 

1.  Wages  depend  on  the  demand  and  supply  of  labor — in  other 

words,  on  population  and  capital .  328 

2.  Examination  of  some  popular  opinions  respecting  wages . 329 

3.  Certain  rare  circumstances  excepted,  high  wages  imply  re¬ 

straints  on  population .  334 

4.  —  which  are  in  some  cases  legal .  338 

5.  —  in  others  the  effect  of  particular  customs .  340 

6.  Due  restriction  of  population  the  only  safeguard  of  a  labor¬ 

ing  class .  342 

Chapter  XII.  Of  Popular  Remedies  for  Low  Wages. 

1.  A  legal  or  customary  minimum  of  wages,  with  a  guarantee  of 

employment  .  345 

2.  —  would  require  as  a  condition,  legal  measures  for  repression 

of  population .  347 

3.  Allowances  in  aid  of  wages . 351 

4.  The  Allotment  System . 353 

Chapter  XIII.  The  Remedies  for  Low  Wages  further  con¬ 
sidered. 

1.  Pernicious  direction  of  public  opinion  on  the  subject  of  popu¬ 

lation  .  357 

2.  Grounds  for  expecting  improvement . 360 

3.  Twofold  means  of  elevating  the  habits  of  the  laboring  people: 

by  education .  364 

4.  —  and  by  large  measures  of  immediate  relief,  through  foreign 

and  home  colonization .  366 

Chapter  XIV.  Of  the  Differences  of  Wages  in  different  Employ¬ 
ments. 

1.  Differences  of  wages  arising  from  different  degrees  of  at¬ 

tractiveness  in  different  employments .  369 

2.  Differences  arising  from  natural  monopolies . 374 

3.  Effect  on  wages  of  a  class  of  subsidized  competitors . 378 

4.  —  of  the  competition  of  persons  with  independent  means  of 

support  .  381 

5.  Wages  of  women,  why  lower  than  those  of  men .  384 

6.  Differences  of  wages  arising  from  restrictive  laws,  and  from 

combinations  .  386 

7.  Cases  in  which  wages  are  fixed  by  custom .  387 

Chapter  XV.  Of  Profits. 

1.  Profits  resolvable  into  three  parts ;  interest,  insurance,  and 

wages  of  superintendence .  388 

2.  The  minimum  of  profits;  and  the  variations  to  which  it  is 

liable  .  390 

3.  Differences  of  profits  arising  from  the  nature  of  the  particu¬ 

lar  employment .  392 

4.  General  tendency  of  profits  to  an  equality .  394 


XVI 


MILL 


PAGE 


5.  Profits  do  not  depend  on  prices,  nor  on  purchase  and  sale - 399 

6.  The  advances  of  the  capitalist  consist  ultimately  in  wages  of 

labor  .  401 

7.  The  rate  of  profit  depends  on  the  Cost  of  Labor . 402 

Chapter  XVI.  Of  Rent. 

1.  Rent  the  effect  of  a  natural  monopoly . 405 

2.  No  land  can  pay  rent  except  land  of  such  quality  or  situation, 

as  exists  in  less  quantity  than  the  demand .  405 

3.  The  rent  of  land  consists  of  the  excess  of  its  return  above 

the  return  to  the  worst  land  in  cultivation .  408 

4.  —  or  to  the  capital  employed  in  the  least  advantageous  cir-  . 

cumstances  .  409 

5.  Is  payment  for  capital  sunk  in  the  soil,  rent,  or  profit? . 412 

6.  Rent  does  not  enter  into  the  cost  of  production  of  agricul¬ 

tural  produce  . 416 

BOOK  III 

EXCHANGE 

Chapter  I.  Of  Value. 

1.  Preliminary  remarks .  419 

2.  Definitions  of  Value  in  Use,  Exchange  Value,  and  Price _ 420 

3.  What  is  meant  by  general  purchasing  power . 421 

4.  Value  a  relative  term.  A  general  rise  or  fall  of  Values  a  con¬ 

tradiction  . .  423 

5.  The  laws  of  Value,  how  modified  in  their  application  to  retail 

transactions  .  424 

Chapter  II.  Of  Demand  and  Supply,  in  their  relation  to  Value. 

1.  Two  conditions  of  Value:  Utility,  and  Difficulty  of  Attain¬ 

ment  .  426 

2.  Three  kinds  of  Difficulty  of  Attainment .  428 

3.  Commodities  which  are  absolutely  limited  in  quantity .  429 

4.  Law  of  their  value,  the  Equation  of  Demand  and  Supply. .. .  430 

5.  Miscellaneous  cases  falling  under  this  law . 432 

Chapter  III.  Of  Cost  of  Production,  in  its  relation  to  Value. 

1.  Commodities  which  are  susceptible  of  indefinite  multiplica¬ 

tion  without  increase  of  cost.  Law  of  their  Value,  Cost 
of  Production . ; .  434 

2.  — operating  through  potential,  but  not  actual,  alterations  of 

supply  .  436 

Chapter  IV.  Ultimate  Analysis  of  Cost  of  Production. 

1.  Principal  element  in  Cost  of  Production — Quantity  of  Labor.  440 

2.  Wages  not  an  element  in  Cost  of  Production .  442 

3.  —  except  in  so  far  as  they  vary  from  employment  to  em¬ 

ployment  .  443 


CONTENTS  xvii 

PAGE 

4.  Profits  an  element  in  Cost  of  Production,  in  so  far  as  they 

vary  from  employment  to  employment .  444 

5.  — or  are  spread  over  unequal  lengths  of  time .  446 

6.  Occasional  elements  in  Cost  of  Production :  taxes,  and  scarcity 

value  of  materials .  449 

Chapter  V.  Of  Rent,  in  its  Relation  to  Value. 

1.  Commodities  which  are  susceptible  of  indefinite  multiplication, 

but  not  without  increase  of  cost.  Law  of  their  Value, 

Cost  of  Production  in  the  most  unfavorable  existing  cir¬ 
cumstances  .  451 

2.  Such  commodities,  when  produced  in  circumstances  more 

favorable,  yield  a  rent  equal  to  the  difference  of  cost . 454 

3.  Rent  of  mines  and  fisheries,  and  ground-rent  of  buildings...  456 

4.  Cases  of  extra  profit  analogous  to  rent .  458 


CHOICE  EXAMPLES  OF  BOOK  ILLUMINATION. 


Fac-similes  from  Illuminated  Manuscripts  and  Illustrated  Books 

of  Early  Date. 


DESCENT  OE  THE  HOLY  GHOST 


This  fac-simile  is  a  page  from  a  Livre  d'Heures  by  Jacques  de  Bregilles,  and 
was  probably  executed  at  Brussels  in  1442. 


\ 


ILLUSTRATIONS 

John  Stuart  Mill  (Portrait) 

Photogravure  from  a  steel  engraving 

Descent  of  the  Holy  Ghost  . 

Fac-simile  Illumination  of  the  Fifteenth  Century 

Hermes  ....... 

Photo-engraving  from  the  original  bronze  statue 


FACING  PAGH 

Frontispiece 


•  xviii 


98 


Title  Page  by  Holbein . 172 

Fac-simile  example  of  Printing  in  the  Sixteenth  Century 

Early  Venetian  Printing . 418 

Fac-simile  of  a  title-page  printed  at  Venice  in  1523 


\ 


PRINCIPLES 


OF 

POLITICAL  ECONOMY 

PRELIMINARY  REMARKS 

IN  every  department  of  human  affairs,  Practice  long  precedes 
Science :  systematic  inquiry  into  the  modes  of  action  of 
the  powers  of  nature,  is  the  tardy  product  of  a  long  course 
of  efforts  to  use  those  powers  for  practical  ends.  The  conception, 
accordingly,  of  Political  Economy  as  a  branch  of  science,  is 
extremely  modern ;  but  the  subject  with  which  its  inquiries  are 
conversant  has  in  all  ages  necessarily  constituted  one  of  the 
chief  practical  interests  of  mankind,  and,  in  some,  a  most  un¬ 
duly  engrossing  one. 

That  subject  is  Wealth.  Writers  on  Political  Economy 
profess  to  teach,  or  to  investigate,  the  nature  of  Wealth,  and 

the  laws  of  its  production  and  distribution ;  including,  directly 
or  remotely,  the  operation  of  all  the  causes  by  which  the  con¬ 

dition  of  mankind,  or  of  any  society  of  human  beings,  in  respect 
to  this  universal  object  of  human  desire,  is  made  prosperous 
or  the  reverse..  Not  that  any  treatise  on  Political  Economy 
can  discuss  or  even  enumerate  all  these  causes ;  but  it  under¬ 
takes  to  set  forth  as  much  as  is  known  of  the  laws  and  principles 
according  to  which  they  operate. 

Everyone  has  a  notion,  sufficiently  correct  for  common  pur¬ 
poses,  of  what  is  meant  by  wealth.  The  inquiries  which  relate 
to  it  are  in  no  danger  of  being  confounded  with  those  relating 
to  any  other  of  the  great  human  interests.  All  know  that  it 
is  one  thing  to  be  rich,  another  thing  to  be  enlightened,  brave, 
or  humane;  that  the  questions  how  a  nation  is  made  wealthy, 
and  how  it  is  made  free,  or  virtuous,  or  eminent  in  literature, 
in  the  fine  arts,  in  arms,  or  in  polity,  are  totally  distinct  in- 
Vol.  I. — I  1 


2 


POLITICAL  ECONOMY 


quiries.  Those  things,  indeed,  are  all  indirectly  connected, 
and  react  upon  one  another.  A  people  has  sometimes  become 
free,  because  it  had  first  grown  wealthy ;  or  wealthy,  because 
it  had  first  become  free.  The  creed  and  laws  of  a  people  act 
powerfully  upon  their  economical  condition;  and  this  again, 
by  its  influence  on  their  mental  development  and  social  rela¬ 
tions,  reacts  upon  their  creed  and  laws.  But  though  the  sub¬ 
jects  are  in  very  close  contact,  they  are  essentially  different, 
and  have  never  been  supposed  to  be  otherwise.  - 

It  is  no  part  of  the  design  of  this  treatise  to  aim  at  metaphysi¬ 
cal  nicety  of  definition,  where  the  ideas  suggested  by  a  term 
are  already  as  determinate  as  practical  purposes  require.  But, 
little  as  it  might  be  expected  that  any  mischievous  confusion 
of  ideas  could  take  place  on  a  subject  so  simple  as  the  question, 
What  is  to  be  considered  as  wealth  ?  it  is  matter  of  history  that 
such  confusion  of  ideas  has  existed — that  theorists  and  practi¬ 
cal  politicians  have  been  equally,  and  at  one  period  universally, 
infected  by  it,  and  that  for  many  generations  it  gave  a  thor¬ 
oughly  false  direction  to  the  policy  of  Europe.  I  refer  to  the 
set  of  doctrines  designated,  since  the  time  of  Adam  Smith,  by 
the  appellation  of  the  Mercantile  System. 

While  this  system  prevailed,  it  was  assumed,  either  expressly 
or  tacitly,  in  the  whole  policy  of  nations,  that  wealth  consisted 
solely  of  money ;  or  of  the  precious  metals,  which,  when  not 
already  in  the  state  of  money,  are  capable  of  being  directly  con¬ 
verted  into  it.  According  to  the  doctrines  then  prevalent, 
whatever  tended  to  heap  up  money  or  bullion  in  a  country 
added  to  its  wealth.  Whatever  sent  the  precious  metals  out 
of  a  country  impoverished  it.  If  a  country  possessed  no  gold 
or  silver  mines,  the  only  industry  by  which  it  could  be  enriched 
was  foreign  trade,  being  the  only  one  which  could  bring  in 
money.  Any  branch  of  trade  which  was  supposed  to  send 
out  more  money  than  it  brought  in,  however  ample  and  valu¬ 
able  might  be  the  returns  in  another  shape,  was  looked  upon 
as  a  losing  trade.  Exportation  of  goods  was  favored  and  en¬ 
couraged  (even  by  means  extremely  onerous  to  the  real  re¬ 
sources  of  the  country),  because  the  exported  goods  being 
stipulated  to  be  paid  for  in  money,  it  was  hoped  that  the  re¬ 
turns  would  actually  be  made  in  gold  and  silver.  Importation 
of  anything,  other  than  the  precious  metals,  was  regarded  as 
a  loss  to  the  nation  of  the  whole  price  of  the  things  imported ; 


PRELIMINARY  REMARKS 


3 


unless  they  were  brought  in  to  be  re-exported  at  a  profit,  or 
unless,  being  the  materials  or  instruments  of  some  industry 
practiced  in  the  country  itself,  they  gave  the  power  of  pro¬ 
ducing  exportable  articles  at  smaller  cost,  and  thereby  effecting 
a  larger  exportation.  The  commerce  of  the  world  was  looked 
upon  as  a  struggle  among  nations,  which  could  draw  to  itself 
the  largest  share  of  the  gold  and  silver  in  existence ;  and  in 
this  competition  no  nation  could  gain  anything,  except  by 
making  others  lose  as  much,  or,  at  the  least,  preventing  them 
from  gaining  it. 

It  often  happens  that  the  universal  belief  of  one  age  of  man¬ 
kind — a  belief  from  which  no  one  4 w.as ,  nor  without  an  extraor¬ 
dinary  effort  of  genius  and  courage,  could  at  that  time  be  free 
— becomes  to  a  subsequent  age  so  palpable  an  absurdity,  that 
the  only  difficulty  then  is  to  imagine  how  such  a  thing  can  ever 
have  appeared  credible.  It  has  so  happened  with  the  doctrine 
that  money  is  synonymous  with  wealth.  The  conceit  seems 
too  preposterous  to  be  thought  of  as  a  serious  opinion.  It 
looks  like  one  of  the  crude  fancies  of  childhood,  instantly  cor¬ 
rected  by  a  word  from  any  grown  person.  But  let  no  one 
feel  confident  that  he  would  have  escaped  the  delusion  if  he  had 
lived  at  the  time  when  it  prevailed.  All  the  associations  en¬ 
gendered  by  common  life,  and  by  the  ordinary  course  of  busi¬ 
ness,  concurred  in  promoting  it.  So  long  as  those  associations 
were  the  only  medium  through  which  the  subject  was  looked 
at,  what  we  now  think  so  gross  an  absurdity  seemed  a  truism. 
Once  questioned,  indeed,  it  was  doomed ;  but  no  one  was  likely 
to  think  of  questioning  it  whose  mind  had  not  become  familiar 
with  certain  modes  of  stating  and  of  contemplating  economical 
phenomena,  which  have  only  found  their  way  into  the  general 
understanding  through  the  influence  of  Adam  Smith  and  of  his 
expositors. 

In  common  discourse,  wealth  is  always  expressed  in  money. 
If  you  ask  how  rich  a  person  is,  you  are  answered  that  he  has 
so  many  thousand  pounds.  All  income  and  expenditure,  all 
gains  and  losses,  everything  by  which  one  becomes  richer  or 
poorer,  are  reckoned  as  the  coming  in  or  going  out  of  so  much 
money.  It  is  true  that  in  the  inventory  of  a  person’s  fortune 
are  included,  not  only  the  money  in  his  actual  possession,  or 
due  to  him,  but  all  other  articles  of  value.  These,  however, 
enter,  not  in  their  own  character,  but  in  virtue  of  the  sums  of 


4 


POLITICAL  ECONOMY 


money  which  they  would  sell  for;  and  if  they  would  sell  for 
less,  their  owner  is  reputed  less  rich,  though  the  things  them¬ 
selves  are  precisely  the  same.  It  is  true,  also,  that  people  do 
not  grow  rich  by  keeping  their  money  unused,  and  that  they 
must  be  willing  to  spend  in  order  to  gain.  Those  who  enrich 
themselves  by  commerce,  do  so  by  giving  money  for  goods  as 
well  as  goods  for  money ;  and  the  first  is  as  necessary  a  part  of 
the  process  as  the  last.  But  a  person  who  buys  goods  for 
purposes  of  gain,  does  so  to  sell  them  again  for  money,  and  in 
the  expectation  of  receiving  more  money  than  he  laid  out :  to 
get  money,  therefore,  seems  even  to  the  person  himself  the  ulti¬ 
mate  end  of  the  whole.  It  often  happens  that  he  is  not  paid 
in  money,  but  in  something  else ;  having  bought  goods  to  a 
value  equivalent,  which  are  set  off  against  those  he  sold.  But 
he  accepted  these  at  a  money  valuation,  and  in  the  belief  that 
they  would  bring  in  more  money  eventually  than  the  price  at 
which  they  were  made  over  to  him.  A  dealer  doing  a  large 
amount  of  business,  and  turning  over  his  capital  rapidly,  has 
but  a  small  portion  of  it  in  ready  money  at  any  one  time.  But 
he  only  feels  it  valuable  to  him  as  it  is  convertible  into  money : 
he  considers  no  transaction  closed  until  the  net  result  is  either 
paid  or  credited  in  money :  when  he  retires  from  business  it  is 
into  money  that  he  converts  the  whole,  and  not  until  then  does 
he  deem  himself  to  have  realized  his  gains :  just  as  if  money 
were  the  only  wealth,  and  money’s  worth  were  only  the  means 
of  attaining  it.  If  it  be  now  asked  for  what  end  money  is  de¬ 
sirable,  unless  to  supply  the  wants  or  pleasures  of  one’s  self  or 
others,  the  champion  of  the  system  would  not  be  at  all  embar¬ 
rassed  by  the  question.  True,  he  would  say,  these  are  the  uses 
of  wealth,  and  very  laudable  uses  while  confined  to  domestic 
commodities,  because  in  that  case,  by  exactly  the  amount  which 
you  expend,  you  enrich  others  of  your  countrymen.  Spend 
your  wealth,  if  you  please,  in  whatever  indulgences  you  have  a 
taste  for ;  but  your  wealth  is  not  the  indulgences,  it  is  the  sum 
of  money,  or  the  annual  money  income,  with  which  you  pur¬ 
chase  them. 

While  there  were  so  many  things  to  render  the  assumption 
which  is  the  basis  of  the  mercantile  system  plausible,  there  is 
also  some  small  foundation  in  reason,  though  a  very  insufficient 
one,  for  the  distinction  which  that  system  so  emphatically 
draws  between  money  and  every  other  kind  of  valuable  pos- 


PRELIMINARY  REMARKS 


5 


session.  We  really,  and  justly,  look  upon  a  person  as  pos¬ 
sessing  the  advantages  of  wealth,  not  in  proportion  to  the  use¬ 
ful  and  agreeable  things  of  which  he  is  in  the  actual  enjoyment, 
but  to  his  command  over  the  general  fund  of  things  useful  and 
agreeable ;  the  power  he  possesses  of  providing  for  any  exi¬ 
gency,  or  obtaining  any  object  of  desire.  Now,  money  is  itself 
that  power ;  while  all  other  things,  in  a  civilized  state,  seem  to 
confer  it  only  by  their  capacity  of  being  exchanged  for  money. 
To  possess  any  other  article  of  wealth,  is  to  possess  that  par¬ 
ticular  thing,  and  nothing  else :  if  you  wish  for  another  thing 
instead  of  it,  you  have  first  to  sell  it,  or  to  submit  to  the  incon¬ 
venience  and  delay  (if  not  the  impossibility)  of  finding  some 
one  who  has  what  you  want,  and  is  willing  to  barter  it  for  what 
you  have.  But  with  money  you  are  at  once  able  to  buy  what¬ 
ever  things  are  for  sale :  and  one  whose  fortune  is  in  money, 
or  in  things  rapidly  convertible  into  it,  seems  both  to  himself 
and  others  to  possess  not  any  one  thing,  but  all  the  things 
which  the  money  places  it  at  his  option  to  purchase.  The 
greatest  part  of  the  utility  of  wealth,  beyond  a  very  moderate 
quantity,  is  not  the  indulgences  it  procures,  but  the  reserved 
power  which  its  possessor  holds  in  his  hands  of  attaining  pur¬ 
poses  generally ;  and  this  power  no  other  kind  of  wealth  confers 
so  immediately  or  so  certainly  as  money.  It  is  the  only  form 
of  wealth  which  is  not  merely  applicable  to  some  one  use,  but 
can  be  turned  at  once  to  any  use.  And  this  distinction  was  the 
more  likely  to  make  an  impression  upon  governments,  as  it  is 
one  of  considerable  importance  to  them.  A  civilized  govern¬ 
ment  derives  comparatively  little  advantage  from  taxes  unless 
it  can  collect  them  in  money :  and  if  it  has  large  or  sudden  pay¬ 
ments  to  make,  especially  payments  in  foreign  countries  for 
wars  or  subsidies,  either  for  the  sake  of  conquering  or  of  not 
being  conquered  (the  two  chief  objects  of  national  policy  until 
a  late  period),  scarcely  any  medium  of  payment  except  money 
will  serve  the  purpose.  All  these  causes  conspire  to  make  both 
individuals  and  governments,  in  estimating  their  means,  attach 
almost  exclusive  importance  to  money,  either  in  esse  or  in  posse, 
and  look  upon  all  other  things  (when  viewed  as  part  of  their 
resources)  scarcely  otherwise  than  as  the  remote  means  of  ob¬ 
taining  that  which  alone,  when  obtained,  affords  the  indefinite, 
and  at  the  same  time  instantaneous,  command  over  objects  of 
desire,  which  best  answers  to  the  idea  of  wealth. 


6 


POLITICAL  ECONOMY 


An  absurdity,  however,  does  not  cease  to  be  an  absurdity 
when  we  have  discovered  what  were  the  appearances  which 
made  it  plausible ;  and  the  Mercantile  Theory  could  not  fail  to 
be  seen  in  its  true  character  when  men  began,  even  in  an  im¬ 
perfect  manner,  to  explore  into  the  foundations  of  things,  and 
seek  their  premises  from  elementary  facts,  and  not  from  the 
forms  and  phrases  of  common  discourse.  So  soon  as  they 
asked  themselves  what  is  really  meant  by  money — what  it  is 
in  its  essential  characters,  and  the  precise  nature  of  the  func¬ 
tions  it  performs — they  reflected  that  money,  like  other  things, 
is  only  a  desirable  possession  on  account  of  its  uses ;  and  that 
these,  instead  of  being,  as  they  delusively  appear,  indefinite, 
are  of  a  strictly  defined  and  limited  description,  namely,  to 
facilitate  the  distribution  of  the  produce  of  industry  according 
to  the  convenience  of  those  among  whom  it  is  shared.  Further 
consideration  showed  that  the  uses  of  money  are  in  no  respect 
promoted  by  increasing  the  quantity  which  exists  and  circu¬ 
lates  in  a  country ;  the  service  which  it  performs  being  as  well 
rendered  by  a  small  as  by  a  large  aggregate  amount.  Two 
million  quarters  of  corn  will  not  feed  so  many  persons  as  four 
millions ;  but  two  millions  of  pounds  sterling  will  carry  on  as 
much  traffic,  will  buy  and  sell  as  many  commodities,  as  four 
millions,  though  at  lower  nominal  prices.  Money,  as  money, 
satisfies  no  want ;  its  worth  to  any  one,  consists  in  its  being  a 
convenient  shape  in  which  to  receive  his  incomings  of  all  sorts, 
which  incomings  he  afterwards,  at  the  times  which  suit  him 
best,  converts  into  the  forms  in  which  they  can  be  useful  to  him. 
Great  as  the  difference  would  be  between  a  country  with  money, 
and  a  country  altogether  without  it,  it  would  be  only  one  of 
convenience;  a  saving  of  time  and  trouble,  like  grinding  by 
water  power  instead  of  by  hand,  or  (to  use  Adam  Smith’s  illus¬ 
tration)  like  the  benefit  derived  from  roads;  and  to  mistake 
money  for  wealth,  is  the  same  sort  of  error  as  to  mistake  the 
highway  which  may  be  the  easiest  way  of  getting  to  your  house 
or  lands,  for  the  house  and  lands  themselves. 

Money,  being  the  instrument  of  an  important  public  and 
private  purpose,  is  rightly  regarded  as  wealth ;  but  everything 
else  which  serves  any  human  purpose,  and  which  nature  does 
not  afford  gratuitously,  is  wealth  also.  To  be  wealthy  is  to 
have  a  large  stock  of  useful  articles,  or  the  means  of  purchasing 
them.  Everything  forms  therefore  a  part  of  wealth,  which 


PRELIMINARY  REMARKS 


7 


has  a  power  of  purchasing ;  for  which  anything  useful  or  agree¬ 
able  would  be  given  in  exchange.  Things  for  which  nothing 
could  be  obtained  in  exchange,  however  useful  or  necessary 
they  may  be,  are  not  wealth  in  the  sense  in  which  the  term  is 
used  in  Political  Economy.  Air,  for  example,  though  the 
most  absolute  of  necessaries,  bears  no  price  in  the  market, 
because  it  can  be  obtained  gratuitously :  to  accumulate  a  stock 
of  it  would  yield  no  profit  or  advantage  to  anyone;  and  the 
laws  of  its  production  and  distribution  are  the  subject  of  a 
very  different  study  from  Political  Economy.  But  though  air 
is  not  wealth,  mankind  are  much  richer  by  obtaining  it  gratis, 
since  the  time  and  labor  which  would  otherwise  be  required 
for  supplying  the  most  pressing  of  all  wants,  can  be  devoted  to 
other  purposes.  It  is  possible  to  imagine  circumstances  in 
which  air  would  be  a  part  of  wealth.  If  it  became  customary 
to  sojourn  long  in  places  where  the  air  does  not  naturally  pene¬ 
trate,  as  in  diving-bells  sunk  in  the  sea,  a  supply  of  air  artificially 
furnished  would,  like  water  conveyed  into  houses,  bear  a  price : 
and  if  from  any  revolution  in  nature  the  atmosphere  became 
too  scanty  for  the  consumption,  or  could  be  monopolized,  air 
might  acquire  a  very  high  marketable  value.  In  such  a  case, 
the  possession  of  it,  beyond  his  own  wants,  would  be,  to  its 
owner,  wealth ;  and  the  general  wealth  of  mankind  might  at 
first  sight  appear  to  be  increased,  by  what  would  be  so  great 
a  calamity  to  them.  The  error  would  lie  in  not  considering, 
that  however  rich  the  possessor  of  air  might  become  at  the 
expense  of  the  rest  of  the  community,  all  persons  else  would 
be  poorer  by  all  that  they  were  compelled  to  pay  for  what  they 
had  before  obtained  without  payment. 

This  leads  to  an  important  distinction  in  the  meaning  of  the 
word  wealth,  as  applied  to  the  possessions  of  an  individual, 
and  to  those  of  a  nation,  or  of  mankind.  In  the  wealth  of  man¬ 
kind,  nothing  is  included  which  does  not  of  itself  answer  some 
purpose  of  utility  or  pleasure.  To  an  individual,  anything  is 
wealth,  which,  though  useless  in  itself,  enables  him  to  claim 
from  others  a  part  of  their  stock  of  things  useful  or  pleasant. 
Take,  for  instance,  a  mortgage  of  a  thousand  pounds  on  a 
landed  estate.  This  is  wealth  to  the  person  to  whom  it  brings 
in  a  revenue,  and  who  could  perhaps  sell  it  in  the  market  for 
the  full  amount  of  the  debt.  But  it  is  not  wealth  to  the  coun¬ 
try;  if  the  engagement  were  annulled,  the  country  would  be 


8 


POLITICAL  ECONOMY 


neither  poorer  nor  richer.  The  mortgagee  would  have  lost  a 
thousand  pounds,  and  the  owner  of  the  land  would  have  gained 
it.  Speaking  nationally,  the  mortgage  was  not  itself  wealth, 
but  merely  gave  A  a  claim  to  a  portion  of  the  wealth  of  B.  It 
was  wealth  to  A,  and  wealth  which  he  could  transfer  to  a  third 
person;  but  what  he  so  transferred  was  in  fact  a  joint  owner¬ 
ship,  to  the  extent  of  a  thousand  pounds,  in  the  land  of  which 
B  was  nominally  the  sole  proprietor.  The  position  of  fund- 
holders,  or  owners  of  the  public  debt  of  a  country,  is  similar. 
They  are  mortgagees  on  the  general  wealth  of  the  country. 
The  cancelling  of  the  debt  would  be  no  destruction  of  wealth, 
but  a  transfer  of  it :  a  wrongful  abstraction  of  wealth  from  cer¬ 
tain  members  of  the  community,  for  the  profit  of  the  govern¬ 
ment,  or  of  the  tax-payers.  Funded  property  therefore  cannot 
be  counted  as  part  of  the  national  wealth.  This  is  not  always 
borne  in  mind  by  the  dealers  in  statistical  calculations.  For 
example,  in  estimates  of  the  gross  income  of  the  country, 
founded  on  the  proceeds  of  the  income  tax,  incomes  derived 
from  the  funds  are  not  always  excluded :  though  the  tax-payers 
are  assessed  on  their  whole  nominal  income,  without  being  per¬ 
mitted  to  deduct  from  it  the  portion  levied  from  them  in  taxa¬ 
tion  to  form  the  income  of  the  fund-holder.  In  this  calculation, 
therefore,  one  portion  of  the  general  income  of  the  country  is 
counted  twice  over,  and  the  aggregate  amount  made  to  appear 
greater  than  it  is  by  almost  thirty  millions.  A  country,  how¬ 
ever,  may  include  in  its  wealth  all  stock  held  by  its  citizens  in 
the  funds  of  foreign  countries,  and  other  debts  due  to  them 
from  abroad.  But  even  this  is  only  wealth  to  them  by  being  a 
part  ownership  in  wealth  held  by  others.  It  forms  no  part  of 
the  collective  wealth  of  the  human  race.  It  is  an  element  in 
the  distribution,  but  not  in  the  composition,  of  the  general 
wealth. 

It  has  been  proposed  to  define  wealth  as  signifying  “  instru¬ 
ments  ”  :  meaning  not  tools  and  machinery  alone,  but  the  whole 
accumulation  possessed  by  individuals  or  communities,  of 
means  for  the  attainment  of  their  ends.  Thus,  a  field  is  an  in¬ 
strument,  because  it  is  a  means  to  the  attainment  of  corn.  Corn 
is  an  instrument,  being  a  means  to  the  attainment  of  flour. 
Flour  is  an  instrument,  being  a  means  to  the  attainment  of 
bread.  Bread  is  an  instrument,  as  a  means  to  the  satisfaction 
of  hunger  and  to  the  support  of  life.  Here  we  at  last  arrive  at 


PRELIMINARY  REMARKS 


9 


things  which  are  not  instruments,  being  desired  on  their  own 
account,  and  not  as  mere  means  to  something  beyond.  This 
view  of  the  subject  is  philosophically  correct ;  or  rather,  this 
mode  of  expression  may  be  usefully  employed  along  with 
others,  not  as  conveying  a  different  view  of  the  subject  from 
the  common  one,  but  as  giving  more  distinctness  and  reality 
to  the  common  view.  It  departs,  however,  too  widely  from 
the  custom  of  language,  to  be  likely  to  obtain  general  accept¬ 
ance,  or  to  be  of  use  for  any  other  purpose  than  that  of  occa¬ 
sional  illustration. 

Another  example  of  a  possession  which  is  wealth  to  the  per¬ 
son  holding  it,  but  not  wealth  to  the  nation,  or  to  mankind,  is 
slaves.  It  is  by  a  strange  confusion  of  ideas  that  slave  property 
(as  it  is  termed)  is  counted,  at  so  much  per  head,  in  an  estimate 
of  the  wealth,  or  of  the  capital,  of  the  country  which  tolerates 
the  existence  of  such  property.  If  a  human  being,  considered 
as  an  object  possessing  productive  powers,  is  part  of  the  na¬ 
tional  wealth  when  his  powers  are  owned  by  another  man,  he 
cannot  be  less  a  part  of  it  when  they  are  owned  by  himself. 
Whatever  he  is  worth  to  his  master  is  so  much  property  ab¬ 
stracted  from  himself,  and  its  abstraction  cannot  augment  the 
possessions  of  the  two  together,  or  of  the  country  to  which  they 
both  belong.  In  propriety  of  classification,  however,  the  peo¬ 
ple  of  a  country  are  not  to  be  counted  in  its  wealth.  They  are 
that  for  the  sake  of  which  its  wealth  exists.  The  term  wealth 
is  wanted  to  denote  the  desirable  objects  which  they  possess, 
not  inclusive  of,  but  in  contradistinction  to,  their  own  persons. 
They  are  not  wealth  to  themselves,  though  they  are  means  of 
acquiring  it. 

Wealth,  then,  may  be  defined,  all  useful  or  agreeable  things 
which  possess  exchangeable  value ;  or,  in  other  words,  all  use- 
Tul  or  agreeable  things  except  those  which  can  be  obtained,  in 
the  quantity  desired,  without  labor  or  sacrifice.  To  this  defi¬ 
nition,  the  only  objection  seems  to  be,  that  it  leaves  in  uncer¬ 
tainty  a  question  which  has  been  much  debated — whether  what 
are  called  immaterial  products  are  to  be  considered  as  wealth : 
whether,  for  example,  the  skill  of  a  workman,  or  any  other 
natural  or  acquired  power  of  body  or  mind,  shall  be  called 
wealth,  or  not :  a  question,  not  of  very  great  importance,  and 
which,  so  far  as  requiring  discussion,  will  be  more  conveniently 
considered  in  another  place.* 

*  Infra,  book  I.  chap.  iii. 


IO 


POLITICAL  ECONOMY 


These  things  having  been  premised  respecting  wealth,  we 
shall  next  turn  our  attention  to  the  extraordinary  differences 
in  respect  to  it,  which  exist  between  nation  and  nation,  and  be¬ 
tween  different  ages  of  the  world ;  differences  both  in  the  quan¬ 
tity  of  wealth,  and  in  the  kind  of  it;  as  well  as  in  the  manner 
in  which  the  wealth  existing  in  the  community  is  shared  among 
its  members. 

There  is,  perhaps,  no  people  or  community,  now  existing, 
which  subsists  entirely  on  the  spontaneous  produce  of  vegeta¬ 
tion.  But  many  tribes  still  live  exclusively,  or  almost  exclu¬ 
sively,  on  wild  animals,  the  produce  of  hunting  or  fishing.  Their 
clothing  is  skins ;  their  habitations  huts  rudely  formed  of  logs 
or  boughs  of  trees,  and  abandoned  at  an  hour’s  notice.  The 
food  they  use  being  little  susceptible  of  storing  up,  they  have 
no  accumulation  of  it,  and  are  often  exposed  to  great  privations. 
The  wealth  of  such  a  community  consists  solely  of  the  skins 
they  wear ;  a  few  ornaments,  the  taste  for  which  exists  among 
most  savages ;  some  rude  utensils ;  the  weapons  with  which 
they  kill  their  game,  or  fight  against  hostile  competitors  for  the 
means  of  subsistence ;  canoes  for  crossing  rivers  and  lakes,  or 
fishing  in  the  sea ;  and  perhaps  some  furs  or  other  productions 
of  the  wilderness,  collected  to  be  exchanged  with  civilized  peo¬ 
ple  for  blankets,  brandy,  and  tobacco ;  of  which  foreign  produce 
also  there  may  be  some  unconsumed  portion  in  store.  To  this 
scanty  inventory  of  material  wealth,  ought  to  be  added  their 
land ;  an  instrument  of  production  of  which  they  make  slender 
use,  compared  with  more  settled  communities,  but  which  is 
still  the  source  of  their  subsistence,  and  which  has  a  marketable 
value  if  there  be  any  agricultural  community  in  the  neighbor¬ 
hood  requiring  more  land  than  it  possesses.  This  is  the  state 
of  greatest  poverty  in  which  any  entire  community  of  human 
beings  is  known  to  exist;  though  there  are  much  richer  com¬ 
munities  in  which  portions  of  the  inhabitants  are  in  a  condition, 
as  to  subsistence  and  comfort,  as  little  enviable  as  that  of  the 
savage. 

The  first  great  advance  beyond  this  state  consists  in  the 
domestication  of  the  more  useful  animals ;  giving  rise  to  the 
pastoral  or  nomad  state,  in  which  mankind  do  not  live  on 
the  produce  of  hunting,  but  on  milk  and  its  products,  and  on 
the  annual  increase  of  flocks  and  herds.  This  condition  is 
not  only  more  desirable  in  itself,  but  more  conducive  to  further 


PRELIMINARY  REMARKS 


1 1 


progress ;  and  a  much  more  considerable  amount  of  wealth  is 
accumulated  under  it.  So  long  as  the  vast  natural  pastures  of 
the  earth  are  not  yet  so  fully  occupied  as  to  be  consumed  more 
rapidly  than  they  are  spontaneously  reproduced,  a  large  and 
constantly  increasing  stock  of  subsistence  may  be  collected  and 
preserved,  with  little  other  labor  than  that  of  guarding  the 
cattle  from  the  attacks  of  wild  beasts,  and  from  the  force  or 
wiles  of  predatory  men.  Large  flocks  and  herds,  therefore, 
are  in  time  possessed,  by  active  and  thrifty  individuals  through 
their  own  exertions,  and  by  the  heads  of  families  and  tribes 
through  the  exertions  of  those  who  are  connected  with  them 
by  allegiance.  There  thus  arises,  in  the  shepherd  state,  in¬ 
equality  of  possessions ;  a  thing  which  scarcely  exists  in  the 
savage  state,  where  no  one  has  much  more  than  absolute  neces¬ 
saries,  and  in  case  of  deficiency  must  share  even  those  with  his 
tribe.  In  the  nomad  state,  some  have  an  abundance  of  cattle, 
sufficient  for  the  food  of  a  multitude,  while  others  have  not  con¬ 
trived  to  appropriate  and  retain  any  superfluity,  or  perhaps  any 
cattle  at  all.  But  subsistence  has  ceased  to  be  precarious,  since 
the  more  successful  have  no  other  use  which  they  can  make  of 
their  surplus  than  to  feed  the  less  fortunate,  while  every  in¬ 
crease  in  the  number  of  persons  connected  with  them  is  an  in¬ 
crease  both  of  security  and  of  power :  and  thus  they  are  enabled 
to  divest  themselves  of  all  labor  except  that  of  government 
and  superintendence,  and  acquire  dependents  to  fight  for  them 
in  war  and  to  serve  them  in  peace.  One  of  the  features  of  this 
state  of  society  is,  that  a  part  of  the  community,  and  in  some 
degree  even  the  whole  of  it,  possess  leisure.  Only  a  portion 
of  time  is  required  for  procuring  food,  and  the  remainder  is  not 
engrossed  by  anxious  thought  for  the  morrow,  or  necessary 
repose  from  muscular  activity.  Such  a  life  is  highly  favorable 
to  the  growth  of  new  wants,  and  opens  a  possibility  of  their 
gratification.  A  desire  arises  for  better  clothing,  utensils,  and 
implements,  than  the  savage  state  contents  itself  with ;  and  the 
surplus  food  renders  it  practicable  to  devote  to  these  purposes 
the  exertions  of  a  part  of  the  tribe.  In  all  or  most  nomad  com¬ 
munities  we  find  domestic  manufactures  of  a  coarse,  and  in 
some,  of  a  fine  kind.  There  is  ample  evidence  that  while  those 
parts  of  the  world  which  have  been  the  cradle  of  modern  civili¬ 
zation  were  still  generally  in  the  nomad  state,  considerable  skill 
had  been  attained  in  spinning,  weaving,  and  dyeing  woollen 


12 


POLITICAL  ECONOMY 


garments,  in  the  preparation  of  leather,  and  in  what  appears  a 
still  more  difficult  invention,  that  of  working  in  metals.  Even 
speculative  science  took  its  first  beginnings  from  the  leisure 
characteristic  of  this  stage  of  social  progress.  The  earliest  as¬ 
tronomical  observations  are  attributed,  by  a  tradition  which 
has  much  appearance  of  truth,  to  the  shepherds  of  Chaldaea. 

From  this  state  of  society  to  the  agricultural  the  transition 
is  not  indeed  easy  (for  no  great  change  in  the  habits  of  mankind 
is  otherwise  than  difficult,  and  in  general  either  painful  or  very 
slow),  but  it  lies  in  what  may  be  called  the  spontaneous  course 
of  events.  The  growth  of  the  population  of  men  and  cattle 
began  in  time  to  press  upon  the  earth’s  capabilities  of  yielding 
natural  pasture:  and  this  cause  doubtless  produced  the  first 
tilling  of  the  ground,  just  as  at  a  later  period  the  same  cause 
made  the  superfluous  hordes  of  the  nations  which  had  remained 
nomad  precipitate  themselves  upon  those  which  had  already 
become  agricultural ;  until,  these  having  become  sufficiently 
powerful  to  repel  such  inroads,  the  invading  nations,  deprived 
of  this  outlet,  were  obliged  also  to  become  agricultural  com¬ 
munities. 

But  after  this  great  step  had  been  completed,  the  subsequent 
progress  of  mankind  seems  by  no  means  to  have  been  so  rapid 
(certain  rare  combinations  of  circumstances  excepted)  as  might 
perhaps  have  been  anticipated.  The  quantity  of  human  food 
which  the  earth  is  capable  of  returning  even  to  the  most 
wretched  system  of  agriculture,  so  much  exceeds  what  could 
be  obtained  in  the  purely  pastoral  state,  that  a  great  increase 
of  population  is  invariably  the  result.  But  this  additional  food 
is  only  obtained  by  a  great  additional  amount  of  labor ;  so  that 
not  only  an  agricultural  has  much  less  leisure  than  a  pastoral 
population,  but,  with  the  imperfect  tools  and  unskilful  proc¬ 
esses  which  are  for  a  long  time  employed  (and  which  over  the 
greater  part  of  the  earth  have  not  even  yet  been  abandoned), 
agriculturists  do  not,  unless  in  unusually  advantageous  cir¬ 
cumstances  of  climate  and  soil,  produce  so  great  a  surplus  of 
food  beyond  their  necessary  consumption,  as  to  support  any 
large  class  of  laborers  engaged  in  other  departments  of  in¬ 
dustry.  The  surplus,  too,  whether  small  or  great,  is  usually 
torn  from  the  producers,  either  by  the  government  to  which 
they  are  subject,  or  by  individuals,  who  by  superior  force,  or 
by  availing  themselves  of  religious  or  traditional  feelings  of 


PRELIMINARY  REMARKS 


*3 


subordination,  have  established  themselves  as  lords  of  the 
soil. 

The  first  of  these  modes,  of  appropriation,  by  the  govern¬ 
ment,  is  characteristic  of  the  extensive  monarchies  which  from 
a  time  beyond  historical  record  have  occupied  the  plains  of 
Asia.  The  government,  in  those  countries,  though  varying 
in  its  qualities  according  to  the  accidents  of  personal  character, 
seldom  leaves  much  to  the  cultivators  beyond  mere  necessaries, 
and  often  strips  them  so  bare  even  of  these,  that  it  finds  itself 
obliged,  after  taking  all  they  have,  to  lend  part  of  it  back  to 
those  from  whom  it  has  been  taken,  in  order  to  provide  them 
with  seed,  and  enable  them  to  support  life  until  another  harvest. 
Under  the  regime  in  question,  though  the  bulk  of  the  popula¬ 
tion  are  ill  provided  for,  the  government,  by  collecting  small 
contributions  from  great  numbers,  is  enabled,  with  any  toler¬ 
able  management,  to  make  a  show  of  riches  quite  out  of  pro¬ 
portion  to  the  general  condition  of  the  society ;  and  hence  the 
inveterate  impression,  of  which  Europeans  have  only  at  a  late 
period  been  disabused,  concerning  the  great  opulence  of  Orien¬ 
tal  nations.  In  this  wealth,  without  reckoning  the  large  por¬ 
tion  which  adheres  to  the  hands  employed  in  collecting  it,  many 
persons  of  course  participate,  besides  the  immediate  household 
of  the  sovereign.  A  large  part  is  distributed  among  the  various 
functionaries  of  government,  and  among  the  objects  of  the  sov¬ 
ereign’s  favor  or  caprice.  A  part  is  occasionally  employed  in 
works  of  public  utility.  The  tanks,  wells,  and  canals  for  irri¬ 
gation,  without  which  in  many  tropical  climates  cultivation 
could  hardly  be  carried  on ;  the  embankments  which  confine 
the  rivers,  the  bazars  for  dealers,  and  the  scraees  for  travellers, 
none  of  which  could  have  been  made  by  the  scanty  means  in 
the  possession  of  those  using  them,  owe  their  existence  to  the 
liberality  and  enlightened  self-interest  of  the  better  order  of 
princes,  or  to  the  benevolence  or  ostentation  of  here  and  there 
a  rich  individual,  whose  fortune,  if  traced  to  its  source,  is  al¬ 
ways  found  to  have  been  drawn  immediately  or  remotely  from 
the  public  revenue,  most  frequently  by  a  direct  grant  of  a  por¬ 
tion  of  it  from  the  sovereign. 

The  ruler  of  a  society  of  this  description,  after  providing 
largely  for  his  own  support,  and  that  of  all  persons  in  whom  he 
feels  an  interest,  and  after  maintaining  as  many  soldiers  as  he 
thinks  needful  for  his  security  or  his  state,  has  a  disposable  resi- 


14 


POLITICAL  ECONOMY 


due,  which  he  is  glad  to  exchange  for  articles  of  luxury  suitable 
to  his  disposition :  as  have  also  the  class  of  persons  who  have 
been  enriched  by  his  favor,  or  by  handling  the  public  revenues. 
A  demand  thus  arises  for  elaborate  and  costly  manufactured 
articles,  adapted  to  a  narrow  but  a  wealthy  market.  This  de¬ 
mand  is  often  supplied  almost  exclusively  by  the  merchants  of 
more  advanced  communities,  but  often  also  raises  up  in  the 
country  itself  a  class  of  artificers,  by  whom  certain  fabrics  are 
carried  to  as  high  excellence  as  can  be  given  by  patience, 
quickness  of  perception  and  observation,  and  manual  dex¬ 
terity,  without  any  considerable  knowledge  of  the  properties 
of  objects :  such  as  some  of  the  cotton  fabrics  of  India.  These 
artificers  are  fed  by  the  surplus  food  which  has  been  taken  by 
the  government  and  its  agents  as  their  share  of  the  produce. 
So  literally  is  this  the  case,  that  in  some  countries  the  workman, 
instead  of  taking  the  work  home,  and  being  paid  for  it  after  it  is 
finished,  proceeds  with  his  tools  to  his  customer’s  house,  and 
is  there  subsisted  until  the  work  is  complete.  The  insecurity, 
however,  of  all  possessions  in  this  state  of  society,  induces  even 
the  richest  purchasers  to  give  a  preference  to  such  articles  as, 
being  of  an  imperishable  nature,  and  containing  great  value 
in  small  bulk,  are  adapted  for  being  concealed  or  carried  off. 
Gold  and  jewels,  therefore,  constitute  a  large  proportion  of  the 
wealth  of  these  nations,  and  many  a  rich  Asiatic  carries  nearly 
his  whole  fortune  on  his  person,  or  on  those  of  the  women  of 
his  harem.  No  one,  except  the  monarch,  thinks  of  investing 
his  wealth  in  a  manner  not  susceptible  of  removal.  He,  in¬ 
deed,  if  he  feels  safe  on  his  throne,  and  reasonably  secure  of 
transmitting  it  to  his  descendants,  sometimes  indulges  a  taste 
for  durable  edifices,  and  produces  the  Pyramids,  or  the  Taj 
Mahal  and  the  Mausoleum  at  Sekundra.  The  rude  manu¬ 
factures  destined  for  the  wants  of  the  cultivators  are  worked 
up  by  village  artisans,  who  are  remunerated  by  land  given  to 
them  rent-free  to  cultivate,  or  by  fees  paid  to  them  in  kind  from 
such  share  of  the  crop  as  is  left  to  the  villagers  by  the  govern¬ 
ment.  This  state  of  society,  however,  is  not  destitute  of  a  mer¬ 
cantile  class ;  composed  of  two  divisions,  grain  dealers  and 
money  dealers.  The  grain  dealers  do  not  usually  buy  grain 
from  the  producers,  but  from  the  agents  of  government,  who, 
receiving  the  revenue  in  kind,  are  glad  to  devolve  upon  others 
the  business  of  conveying  it  to  the  places  where  the  prince,  his 


PRELIMINARY  REMARKS 


15 


chief  civil  and  military  officers,  the  bulk  of  his  troops,  and  the 
artisans  who  supply  the  wants  of  these  various  persons,  are 
assembled.  The  money  dealers  lend  to  the  unfortunate  culti¬ 
vators,  when  ruined  by  bad  seasons  or  fiscal  exactions,  the 
means  of  supporting  life  and  continuing  their  cultivation,  and 
are  repaid  with  enormous  interest  at  the  next  harvest :  or, 
on  a  large  scale,  they  lend  to  the  government,  or  to  those  to 
whom  it  has  granted  a  portion  of  the  revenue,  and  are  indem¬ 
nified  by  assignments  on  the  revenue  collectors,  or  by  having 
certain  districts  put  into  their  possession,  that  they  may  pay 
themselves  from  the  revenues ;  to  enable  them  to  do  which,  a 
great  portion  of  the  powers  of  government  are  usually  made 
over  simultaneously,  to  be  exercised  by  them  until  either  the 
districts  are  redeemed,  or  their  receipts  have  liquidated  the 
debt.  Thus,  the  commercial  operations  of  both  these  classes 
of  dealers  take  place  principally  upon  that  part  of  the  produce 
of  the  country  which  forms  the  revenue  of  the  government. 
From  that  revenue  their  capital  is  periodically  replaced  with  a 
profit,  and  that  is  also  the  source  from  which  their  original 
funds  have  almost  always  been  derived.  Such,  in  its  general 
features,  is  the  economical  condition  of  most  of  the  countries 
of  Asia,  as  it  has  been  from  beyond  the  commencement  of  au¬ 
thentic  history,  and  is  still,  wherever  not  disturbed  by  foreign 
influences. 

In  the  agricultural  communities  of  ancient  Europe  whose 
early  condition  is  best  known  to  us,  the  course  of  things  was 
different.  These,  at  their  origin,  were  mostly  small  town- 
communities,  at  the  first  plantation  of  which,  in  an  unoccupied 
country,  or  in  one  from  which  the  former  inhabitants  had  been 
expelled,  the  land  which  was  taken  possession  of  was  regu¬ 
larly  divided,  in  equal  or  in  graduated  allotments,  among  the 
families  composing  the  community.  In  some  cases,  instead  of 
a  town  there  was  a  confederation  of  towns,  occupied  by  people 
of  the  same  reputed  race,  and  who  were  supposed  to  have  set¬ 
tled  in  the  country  about  the  same  time.  Each  family  pro¬ 
duced  its  own  food  and  the  materials  of  its  clothing,  which  were 
worked  up  within  itself,  usually  by  the  women  of  the  family, 
into  the  coarse  fabrics  with  which  the  age  was  contented. 
Taxes  there  were  none,  as  there  were  either  no  paid  officers  of 
government  or  if  there  were,  their  payment  had  been  provided 
for  by  a  reserved  portion  of  land,  cultivated  by  slaves  on  ac- 


i6 


POLITICAL  ECONOMY 


count  of  the  state;  and  the  army  consisted  of  the  body  of  citi¬ 
zens.  The  whole  produce  of  the  soil,  therefore,  belonged, 
without  deduction,  to  the  family  which  cultivated  it.  So  long 
as  the  progress  of  events  permitted  this  disposition  of  property 
to  last,  the  state  of  society  was,  for  the  majority  of  the  free  cul¬ 
tivators,  probably  not  an  undesirable  one;  and  under  it,  in 
some  cases,  the  advance  of  mankind  in  intellectual  culture  was 
extraordinarily  rapid  and  brilliant.  This  more  especially  hap¬ 
pened  where,  along  with  advantageous  circumstances  of  race 
and  climate,  and  no  doubt  with  many  favorable  accidents  of 
which  all  trace  is  now  lost,  was  combined  the  advantage  of  a 
position  on  the  shores  of  a  great  inland  sea,  the  other  coasts  of 
which  were  already  occupied  by  settled  communities.  The 
knowledge  which  in  such  a  position  was  acquired  of  foreign 
productions,  and  the  easy  access  of  foreign  ideas  and  inven¬ 
tions,  made  the  chain  of  routine,  usually  so  strong  in  a  rude 
people,  hang  loosely  on  these  communities.  To  speak  only  of 
their  industrial  development ;  they  early  acquired  variety  of 
wants  and  desires,  which  stimulated  them  to  extract  from  their 
own  soil  the  utmost  which  they  knew  how  to  make  it  yield ; 
and  when  their  soil  was  sterile,  or  after  they  had  reached  the 
limit  of  its  capacity,  they  often  became  traders,  and  bought  up 
the  productions  of  foreign  countries,  to  sell  them  in  other  coun¬ 
tries  with  a  profit. 

The  duration,  however,  of  this  state  of  things  was  from  the 
first  precarious.  These  little  communities  lived  in  a  state  of 
almost  perpetual  war.  For  this  there  were  many  causes.  In 
the  ruder  and  purely  agricultural  communities  a  frequent  cause 
was  the  mere  pressure  of  their  increasing  population  upon  their 
limited  land,  aggravated  as  that  pressure  so  often  was  by  defi¬ 
cient  harvests  in  the  rude  state  of  their  agriculture,  and  depend¬ 
ing  as  they  did  for  food  upon  a  very  small  extent  of  country. 
On  these  occasions,  the  community  often  emigrated  in  a  body, 
or  sent  forth  a  swarm  of  its  youth,  to  seek,  sword  in  hand,  for 
some  less  warlike  people,  who  could  be  expelled  from  their 
land,  or  detained  to  cultivate  it  as  slaves  for  the  benefit  of  their 
despoilers.  What  the  less  advanced  tribes  did  from  necessity, 
the  more  prosperous  did  from  ambition  and  the  military  spirit : 
and  after  a  time  the  whole  of  these  city-communities  were 
either  conquerors  or  conquered.  In  some  cases,  the  conquer¬ 
ing  state  contented  itself  with  imposing  a  tribute  on  the  van- 


PRELIMINARY  REMARKS 


x7 

quished :  who  being,  in  consideration  of  that  burden,  freed 
from  the  expense  and  trouble  of  their  own  military  and  naval 
protection,  might  enjoy  under  it  a  considerable  share  of  eco¬ 
nomical  prosperity,  while  the  ascendant  community  obtained 
a  surplus  of  wealth,  available  for  purposes  of  collective  luxury 
or  magnificence.  From  such  a  surplus  the  Parthenon  and  the 
Propylaea  were  built,  the  sculptures  of  Phidias  paid  for,  and 
the  festivals  celebrated,  for  which  iEschylus,  Sophocles,  Eu¬ 
ripides,  and  Aristophanes  composed  their  dramas.  But  this 
state  of  political  relations,  most  useful,  while  it  lasted,  to  the 
progress  and  ultimate  interest  of  mankind,  had  not  the  ele¬ 
ments  of  durability.  A  small  conquering  community  which 
does  not  incorporate  its  conquests,  always  ends  by  being  con¬ 
quered.  Universal  dominion,  therefore,  at  last  rested  with  the 
people  who  practised  this  art — with  the  Romans ;  who,  what¬ 
ever  were  their  other  devices,  always  either  began  or  ended  by 
taking  a  great  part  of  the  land  to  enrich  their  own  leading 
citizens,  and  by  adopting  into  the  governing  body  the  prin¬ 
cipal  possessors  of  the  remainder.  It  is  unnecessary  to  dwell 
on  the  melancholy  economical  history  of  the  Roman  Empire. 
When  inequality  of  wealth  once  commences,  in  a  community 
not  constantly  engaged  in  repairing  by  industry  the  injuries 
of  fortune,  its  advances  are  gigantic ;  the  great  masses  of 
wealth  swallow  up  the  smaller.  The  Roman  Empire  ultimately 
became  covered  with  the  vast  landed  possessions  of  a  compara¬ 
tively  few  families,  for  whose  luxury,  and  still  more  for  whose 
ostentation,  the  most  costly  products  were  raised,  while  the 
cultivators  of  the  soil  were  slaves,  or  small  tenants  in  a  nearly 
servile  condition.  From  this  time  the  wealth  of  the  empire 
progressively  declined.  In  the  beginning,  the  public  revenues, 
and  the  resources  of  rich  individuals,  sufficed  at  least  to  cover 
Italy  with  splendid  edifices,  public  and  private :  but  at  length 
so  dwindled  under  the  enervating  influences  of  misgovern- 
ment,  that  what  remained  was  not  even  sufficient  to  keep  those 
edifices  from  decay.  The  strength  and  riches  of  the  civilized 
world  became  inadequate  to  make  head  against  the  nomad 
population  which  skirted  its  northern  frontier :  they  overran 
the  empire,  and  a  different  order  of  things  succeeded. 

In  the  new  frame  in  which  European  society  was  now  cast, 
the  population  of  each  country  may  be  considered  as  com¬ 
posed,  in  unequal  proportions,  of  two  distinct  nations  or  races, 
Vol.  I.— 2 


i8 


POLITICAL  ECONOMY 


the  conquerors  and  the  conquered:  the  first  the  proprietors 
of  the  land,  the  latter  the  tillers  of  it.  These  tillers  were  allowed 
to  occupy  the  land  on  conditions  which,  being  the  product  of 
force,  were  always  onerous,  but  seldom  to  the  extent  of  ab¬ 
solute  slavery.  Already,  in  the  later  times  of  the  Roman  em¬ 
pire,  predial  slavery  had  extensively  transformed  itself  into  a 
kind  of  serfdom :  the  coloni  of  the  Romans  were  rather  villeins 
than  actual  slaves ;  and  the  incapacity  and  distaste  of  the  bar¬ 
barian  conquerors  for  personally  superintending  industrial  oc¬ 
cupations,  left  no  alternative  but  to  allow  to  the  cultivators, 
as  an  incentive  to  exertion,  some  real  interest  in  the  soil.  If, 
for  example,  they  were  compelled  to  labor,  three  days  in  the 
week,  for  their  superior,  the  produce  of  the  remaining  days 
was  their  own.  If  they  were  required  to  supply  the  provisions 
of  various  sorts,  ordinarily  needed  for  the  consumption  of  the 
castle,  and  were  often  subject  to  requisitions  in  excess,  yet  after 
supplying  these  demands  they  were  suffered  to  dispose  at  their 
will  of  whatever  additional  produce  they  could  raise.  Under 
this  system  during  the  Middle  Ages  it  was  not  impossible,  no 
more  than  in  modern  Russia  (where,  up  to  the  recent  measure 
of  emancipation,  the  same  system  still  essentially  prevailed) 
for  serfs  to  acquire  property ;  and  in  fact,  their  accumulations 
are  the  primitive  source  of  the  wealth  of  modern  Europe. 

In  that  age  of  violence  and  disorder,  the  first  use  made  by  a 
serf  of  any  small  provision  which  he  had  been  able  to  accumu¬ 
late,  was  to  buy  his  freedom  and  withdraw  himself  to  some 
town  or  fortified  village,  which  had  remained  undestroyed 
from  the  time  of  the  Roman  dominion ;  or,  without  buying  his 
freedom,  to  abscond  thither.  In  that  place  of  refuge,  sur¬ 
rounded  by  others  of  his  own  class,  he  attempted  to  live,  se¬ 
cured  in  some  measure  from  the  outrages  and  exactions  of  the 
warrior  caste,  by  his  own  prowess  and  that  of  his  fellows.  These 
emancipated  serfs  mostly  became  artificers ;  and  lived  by  ex¬ 
changing  the  produce  of  their  industry  for  the  surplus  food 
and  materials  which  the  soil  yielded  to  its  feudal  proprietors. 
This  gave  rise  to  a  sort  of  European  counterpart  of  the  eco¬ 
nomical  condition  of  Asiatic  countries  ;  except  that,  in  lieu  of  a 
single  monarch  and  a  fluctuating  body  of  favorites  and  em¬ 
ployes,  there  was  a  numerous  and  in  a  considerable  degree  fixed 
class  of  great  landholders ;  exhibiting  far  less  splendor,  be¬ 
cause  individually  disposing  of  a  much  smaller  surplus  pro- 


PRELIMINARY  REMARKS 


19 


duce,  and  for  a  long  time  expending  the  chief  part  of  it  in 
maintaining  the  body  of  retainers  whom  the  warlike  habits  of 
society,  and  the  little  protection  afforded  by  government,  ren¬ 
dered  indispensable  to  their  safety.  The  greater  stability,  the 
fixity  of  personal  position,  which  this  state  of  society  afforded, 
in  comparison  with  the  Asiatic  polity  to  which  it  economically 
corresponded,  was  one  main  reason  why  it  was  also  found  more 
favorable  to  improvement.  From  this  time  the  economical 
advancement  of  society  has  not  been  further  interrupted.  Se¬ 
curity  of  person  and  property  grew  slowly,  but  steadily ;  the 
arts  of  life  made  constant  progress ;  plunder  ceased  to  be  the 
principal  source  of  accumulation  ;  and  feudal  Europe  ripened 
into  commercial  and  manufacturing  Europe.  In  the  latter  part 
of  the  Middle  Ages,  the  towns  of  Italy  and  Flanders,  the  free 
cities  of  Germany,  and  some  towns  of  France  and  England, 
contained  a  large  and  energetic  population  of  artisans,  and 
and  many  rich  burghers,  whose  wealth  had  been  acquired  by 
manufacturing  industry,  or  by  trading  in  the  produce  of  such 
industry.  The  Commons  of  England,  the  Tiers-Etat  of 
France,  the  bourgeoisie  of  the  Continent  generally,  are  the  de¬ 
scendants  of  this  class.  As  these  were  a  saving  class,  while  the 
posterity  of  the  feudal  aristocracy  were  a  squandering  class, 
the  former  by  degrees  substituted  themselves  for  the  latter  as 
the  owners  of  a  great  proportion  of  the  land.  This  natural  ten¬ 
dency  was  in  some  cases  retarded  by  laws  contrived  for  the 
purpose  of  detaining  the  land  in  the  families  of  its  existing  pos¬ 
sessors,  in  other  cases  accelerated  by  political  revolutions. 
Gradually,  though  more  slowly,  the  immediate  cultivators  of 
the  soil,  in  all  the  more  civilized  countries,  ceased  to  be  in  a 
servile  or  semi-servile  state :  though  the  legal  position,  as  well 
as  the  economical  condition  attained  by  them,  vary  extremely 
in  the  different  nations  of  Europe,  and  in  the  great  communi¬ 
ties  which  have  been  founded  beyond  the  Atlantic  by  the  de¬ 
scendants  of  Europeans. 

The  world  now  contains  several  extensive  regions,  provided 
with  the  various  ingredients  of  wealth  in  a  degree  of  abundance 
of  which  former  ages  had  not  even  the  idea.  Without  com¬ 
pulsory  labor,  an  enormous  mass  of  food  is  annually  extracted 
from  the  soil,  and  maintains,  besides  the  actual  producers,  an 
equal,  sometimes  a  greater  number  of  laborers,  occupied  in 
producing  conveniences  and  luxuries  of  innumerable  kinds,  or 


20 


POLITICAL  ECONOMY 


in  transporting  them  from  place  to  place ;  also  a  multitude  of 
persons  employed  in  directing  and  superintending  these  vari¬ 
ous  labors ;  and  over  and  above  all  these,  a  class  more  numer¬ 
ous  than  in  the  most  luxurious  ancient  societies,  of  persons 
whose  occupations  are  of  a  kind  not  directly  productive,  and  of 
persons  who  have  no  occupation  at  all.  The  food  thus  raised, 
supports  a  far  larger  population  than  had  ever  existed  (at  least 
in  the  same  regions)  on  an  equal  space  of  ground ;  and  sup¬ 
ports  them  with  certainty,  exempt  from  those  periodically  re¬ 
curring  famines  so  abundant  in  the  early  history  of  Europe, 
and  in  Oriental  countries  even  now  not  unfrequent.  Besides 
this  great  increase  in  the  quantity  of  food,  it  has  greatly  im¬ 
proved  in  quality  and  variety ;  while  conveniences  and  lux¬ 
uries,  other  than  food,  are  no  longer  limited  to  a  small  and 
opulent  class,  but  descend,  in  great  abundance,  through  many 
widening  strata  in  society.  The  collection  resources  of  one  of 
these  communities,  when  it  chooses  to  put  them  forth  for  any 
unexpected  purpose ;  its  ability  to  maintain  fleets  and  armies, 
to  execute  public  works,  either  useful  or  ornamental,  to  per¬ 
form  national  acts  of  beneficence  like  the  ransom  of  the  West 
India  slaves ;  to  found  colonies,  to  have  its  people  taught,  to 
do  anything  in  short  which  requires  expense,  and  to  do  it  with 
no  sacrifice  of  the  necessaries  or  even  the  substantial  comforts 
of  its  inhabitants,  are  such  as  the  world  never  saw  before. 

But  in  all  these  particulars,  characteristic  of  the  modern  in¬ 
dustrial  communities,  those  communities  differ  widely  from 
one  another.  Though  abounding  in  wealth  as  compared  with 
former  ages,  they  do  so  in  very  different  degrees.  Even  of  the 
countries  which  are  justly  accounted  the  richest,  some  have 
made  a  more  complete  use  of  their  productive  resources,  and 
have  obtained,  relatively  to  their  territorial  extent,  a  much 
larger  produce,  than  others  ;  nor  do  they  differ  only  in  amount 
of  wealth,  but  also  in  the  rapidity  of  its  increase.  The  diversi¬ 
ties  in  the  distribution  of  wealth  are  still  greater  than  in  the 
production.  There  are  great  differences  in  the  condition  of 
the  poorest  class  in  different  countries  ;  and  in  the  proportional 
numbers  and  opulence  of  the  classes  which  are  above  the  poor¬ 
est.  The  very  nature  and  designation  of  the  classes  who 
originally  share  among  them  the  produce  of  the  soil,  vary  not 
a  little  in  different  places.  In  some,  the  landowners  are  a  class 
in  themselves,  almost  entirely  separate  from  the  classes  en- 


PRELIMINARY  REMARKS 


21 


gaged  in  industry :  in  others,  the  proprietor  of  the  land  is  al¬ 
most  universally  its  cultivator,  owning  the  plough,  and  often 
himself  holding  it.  Where  the  proprietor  himself  does  not  cul¬ 
tivate,  there  is  sometimes,  between  him  and  the  laborer,  an  in¬ 
termediate  agency,  that  of  the  farmer,  who  advances  the  sub¬ 
sistence  of  the  laborers,  supplies  the  instruments  of  production, 
and  receives,  after  paying  a  rent  to  the  landowner,  all  the  pro¬ 
duce  :  in  other  cases,  the  landlord,  his  paid  agents,  and  the 
laborers,  are  the  only  sharers.  Manufactures,  again,  are  some¬ 
times  carried  on  by  scattered  individuals,  who  own  or  hire  the 
tools  or  machinery  they  require,  and  employ  little  labor  be¬ 
sides  that  of  their  own  family ;  in  other  cases,  by  large  num¬ 
bers  working  together  in  one  building,  with  expensive  and 
complex  machinery  owned  by  rich  manufacturers.  The  same 
difference  exists  in  the  operations  of  trade.  The  wholesale 
operations  indeed  are  everywhere  carried  on  by  large  capitals, 
where  such  exist ;  but  the  retail  dealings,  which  collectively 
occupy  a  very  great  amount  of  capital,  are  sometimes  con¬ 
ducted  in  small  shops,  chiefly  by  the  personal  exertions  of  the 
dealers  themselves,  with  their  families,  and  perhaps  an  appren¬ 
tice  or  two ;  and  sometimes  in  large  establishments,  of  which 
the  funds  are  supplied  by  a  wealthy  individual  or  association, 
and  the  agency  is  that  of  numerous  salaried  shopmen  or  shop- 
women.  Besides  these  differences  in  the  economical  phenom¬ 
ena  presented  by  different  parts  of  what  is  usually  called  the 
civilized  world,  all  those  earlier  states  which  we  previously 
passed  in  review,  have  continued  in  some  part  or  other  of  the 
world,  down  to  our  own  time.  Hunting  communities  still  exist 
in  America,  nomadic  in  Arabia  and  the  steppes  of  Northern 
Asia ;  Oriental  society  is  in  essentials  what  it  has  always  been  ; 
the  great  empire  of  Russia  is  even  now,  in  many  respects,  the 
scarcely  modified  image  of  feudal  Europe.  Every  one  of  the 
great  types  of  human  society,  down  to  that  of  the  Esquimaux 
or  Patagonians,  is  still  extant. 

These  remarkable  differences  in  the  state  of  different  por¬ 
tions  of  the  human  race,  with  regard  to  the  production  and 
distribution  of  wealth,  must,  like  all  other  phenomena,  depend 
on  causes.  And  it  is  not  a  sufficient  explanation  to  ascribe 
them  exclusively  to  the  degrees  of  knowledge,  possessed  at  dif¬ 
ferent  times  and  places,  of  the  laws  of  nature  and  the  physical 
arts  of  life.  Many  other  causes  co-operate ;  and  that  very 


22 


POLITICAL  ECONOMY 


progress  and  unequal  distribution  of  physical  knowledge,  are 
partly  the  effects,  as  well  as  partly  the  causes,  of  the  state  of  the 
production  and  distribution  of  wealth. 

In  so  far  as  the  economical  condition  of  nations  turns  upon 
the  state  of  physical  knowledge,  it  is  a  subject  for  the  physical 
sciences,  and  the  arts  founded  on  them.  But  in  so  far  as  the 
causes  are  moral  or  psychological,  dependent  on  institutions 
and  social  relations,  or  on  the  principles  of  human  nature,  their 
investigation  belongs  not  to  physical,  but  to  moral  and  social 
science,  and  is  the  object  of  what  is  called  Political  Economy. 

The  production  of  wealth ;  the  extraction  of  the  instruments 
of  human  subsistence  and  enjoyment  from  the  materials  of  the 
globe,  is  evidently  not  an  arbitrary  thing.  It  has  its  necessary 
conditions.  Of  these,  some  are  physical,  depending  on  the 
properties  of  matter,  and  on  the  amount  of  knowledge  of  those 
properties  possessed  at  the  particular  place  and  time.  These 
Political  Economy  does  not  investigate,  but  assumes ;  refer¬ 
ring  for  the  grounds,  to  physical  science  or  common  experience. 
Combining  with  these  facts  of  outward  nature  other  truths 
relating  to  human  nature,  it  attempts  to  trace  the  secondary 
or  derivative  laws,  by  which  the  production  of  wealth  is  deter¬ 
mined  ;  in  which  must  lie  the  explanation  of  the  diversities  of 
riches  and  poverty  in  the  present  and  past,  and  the  ground  of 
whatever  increase  in  wealth  is  reserved  for  the  future. 

Unlike  the  laws  of  Production,  those  of  Distribution  are 
partly  of  human  institution :  since  the  manner  in  which  wealth 
is  distributed  in  any  given  society,  depends  on  the  statutes  or 
usages  therein  obtaining.  But  though  governments  or  na¬ 
tions  have  the  power  of  deciding  what  institutions  shall  exist, 
they  cannot  arbitrarily  determine  how  those  institutions  shall 
work.  The  conditions  on  which  the  power  they  possess  over 
the  distribution  of  wealth  is  dependent,  and  the  manner  in 
which  the  distribution  is  affected  by  the  various  modes  of  con¬ 
duct  which  society  may  think  fit  to  adopt,  are  as  much  a  subject 
for  scientific  inquiry  as  any  of  the  physical  laws  of  nature. 

The  laws  of  Production  and  Distribution,  and  some  of  the 
practical  consequences  deducible  from  them,  are  the  subject 
of  the  following  treatise. 


BOOK  I 

PRODUCTION 


Chapter  I. — Of  the  Requisites  of  Production 


THE  requisites  of  production  are  two:  labor,  and  ap¬ 
propriate  natural  obiectsf 

Labor  is  either  bodily  or  mental ;  or,  to  express  the 
distinction  more  comprehensively,  either  muscular  or  nervous ; 
and  it  is  necessary  to  include  in  the  idea,  not  solely  the  exer¬ 
tion  itself,  but  all  feelings  of  a  disagreeable  kind,  all  bodily 
inconvenience  or  mental  annoyance,  connected  with  the  em¬ 
ployment  of  one’s  thoughts,  or  muscles,  or  both,  in  a  particular 
occupation.  Of  the  other  requisite — appropriate  natural  ob¬ 
jects — it  is  to  be  remarked,  that  some  objects  exist  or  grow  up 
spontaneously,  of  a  kind  suited  to  the  supply  of  human  wants. 
There  are  caves  and  hollow  trees  capable  of  affording  shelter ; 
fruit,  roots,  wild  honey,  and  other  natural  products,  on  which 
human  life  can  be  supported ;  but  even  here  a  considerable 
quantity  of  labor  is  generally  required,  not  for  the  purpose 
of  creating,  but  of  finding  and  appropriating  them.  In  all 
but  these  few  and  (except  in  the  very  commencement  of  human 
society)  unimportant  cases,  the  objects  supplied  by  nature  are 
only  instrumental  to  human  wants,  after  having  undergone 
some  degree  of  transformation  by  human  exertion.  Even  the 
wild  animals  of  the  forest  and  of  the  sea,  from  which  the  hunt¬ 
ing  and  fishing  tribes  derive  their  sustenance — though  the 
labor  of  which  they  are  the  subject  is  chiefly  that  required  for 
appropriating  them — must  yet,  before  they  are  used  as  food,  be 
killed,  divided  into  fragments,  and  subjected  in  almost  all  cases 
to  some  culinary  process,  which  are  operations  requiring  a 
certain  degree  of  human  labor.  The  amount  of  transformation 
which  natural  substances  undergo  before  being  brought  into 
the  shape  in  which  they  are  directly  applied  to  human  use, 
varies  from  this  or  a  still  less  degree  of  alteration  in  the  nature 


24 


POLITICAL  ECONOMY 


and  appearance  of  the  object,  to  a  change  so  total  that  no  trace 
is  perceptible  of  the  original  shape  and  structure.  There  is 
little  resemblance  between  a  piece  of  a  mineral  substance  found 
in  the  earth,  and  a  plough,  an  axe,  or  a  saw.  There  is  less 
resemblance  between  porcelain  and  the  decomposing  granite 
of  which  it  is  made,  or  between  sand  mixed  with  sea-weed, 
and  glass.  The  difference  is  greater  still  between  the  fleece  of  a 
sheep,  or  a  handful  of  cotton  seeds,  and  a  web  of  muslin  or 
broadcloth ;  and  the  sheep  and  seeds  themselves  are  not  spon¬ 
taneous  growths,  but  results  of  previous  labor  and  care.  In 
these  several  cases  the  ultimate  product  is  so  extremely  dis¬ 
similar  to  the  substance  supplied  by  nature,  that  in  the  custom 
of  language  nature  is  represented  as  only  furnishing  materials. 

Nature,  however,  does  more  than  supply  materials ;  she 
also  supplies  powers.  The  matter  of  the  globe  is  not  an  inert 
recipient  of  forms  and  properties  impressed  by  human  hands ; 
it  has  active  energies  by  which  it  co-operates  with,  and  may 
even  be  used  as  a  substitute  for,  labor.  In  the  early  ages  peo¬ 
ple  converted  their  corn  into  flour  by  pounding  it  between 
two  stones ;  they  next  hit  on  a  contrivance  which  enabled  them, 
by  turning  a  handle,  to  make  one  of  the  stones  revolve  upon  the 
other ;  and  this  process,  a  little  improved,  is  still  the  common 
practice  of  the  East.  The  muscular  exertion,  however,  which 
it  required,  was  very  severe  and  exhausting,  insomuch  that  it 
was  often  selected  as  a  punishment  for  slaves  who  had  offended 
their  masters.  When  the  time  came  at  which  the  labor  and 
sufferings  of  slaves  were  thought  worth  economizing,  the 
greater  part  of  this  bodily  exertion  was  rendered  unnecessary, 
by  contriving  that  the  upper  stone  should  be  made  to  revolve 
upon  the  lower,  not  by  human  strength,  but  by  the  force  of 
the  wind  or  of  falling  water.  In  this  case,  natural  agents,  the 
wind  or  the  gravitation  of  the  water,  are  made  to  do  a  portion 
of  the  work  previously  done  by  labor. 

§  2.  Cases  like  this,  in  which  a  certain  amount  of  labor  has 
been  dispensed  with,  its  work  being  devolved  upon  some  nat¬ 
ural  agent,  are  apt  to  suggest  an  erroneous  notion  of  the  com¬ 
parative  functions  of  labor  and  natural  powers;  as  if  the  co¬ 
operation  of  those  powers  with  human  industry  were  limited 
to  the  cases  in  which  they  are  made  to  perform  what  would 
otherwise  be  done  by  labor ;  as  if,  in  the  case  of  things  made 
(as  the  phrase  is)  by  hand,  nature  only  furnished  passive  mate- 


REQUISITES  OF  PRODUCTION 


25 


rials.  This  is  an  illusion.  The  powers  of  nature  are  so  actively 
operative  in  the  one  case  as  in  the  other.  A  workman  takes 
a  stalk  of  the  flax  or  hemp  plant,  splits  it  into  separate  fibres, 
twines  together  several  of  these  fibres  with  his  fingers,  aided 
by  a  simple  instrument  called  a  spindle ;  having  thus  formed 
a  thread,  he  lays  many  such  threads  side  by  side,  and  places 
other  similar  threads  directly  across  them,  so  that  each  passes 
alternately  over  and  under  those  which  are  at  right  angles  to 
it ;  this  part  of  the  process  being  facilitated  by  an  instrument 
called  a  shuttle.  He  has  now  produced  a  web  of  cloth,  either 
linen  or  sack-cloth,  according  to  the  material.  He  is  said  to 
have  done  this  by  hand,  no  natural  force  being  supposed  to 
have  acted  in  concert  with  him.  But  by  what  force  is  each  step 
of  this  operation  rendered  possible,  and  the  web,  when  pro¬ 
duced,  held  together?  By  the  tenacity,  or  force  of  cohesion,  of 
the  fibres :  which  is  one  of  the  forces  in  nature,  and  which  we 
can  measure  exactly  against  other  mechanical  forces,  and  ascer¬ 
tain  how  much  of  any  of  them  it  suffices  to  neutralize  or  coun¬ 
terbalance. 

If  we  examine  any  other  case  of  what  is  called  the  action 
of  man  upon  nature,  we  shall  find  in  like  manner  that  the 
powers  of  nature,  or  in  other  words  the  properties  of  matter, 
do  all  the  work,  when  once  objects  are  put  into  the  right  posi¬ 
tion.  This  one  operation,  of  putting  things  into  fit  places  for 
being  acted  upon  by  their  own  internal  forces,  and  by  those 
residing  in  other  natural  objects,  is  all  that  man  does,  or  can 
do,  with  matter.  He  only  moves  one  thing  to  or  from  another. 
He  moves  a  seed  into  the  ground ;  and  the  natural  forces  of 
vegetation  produce  in  succession  a  root,  a  stem,  leaves,  flowers, 
and  fruit.  He  moves  an  axe  through  a  tree,  and  it  falls  by  the 
natural  force  of  gravitation ;  he  moves  a  saw  through  it,  in 
a  particular  manner,  and  the  physical  properties  by  which  a 
softer  substance  gives  way  before  a  harder,  make  it  separate 
into  planks,  which  he  arranges  in  certain  positions,  with  nails 
driven  through  them,  or  adhesive  matter  between  them,  and 
produces  a  table,  or  a  house.  He  moves  a  spark  to  fuel,  and 
it  ignites,  and  by  the  force  generated  in  combustion  it  cooks  the 
food,  melts  or  softens  the  iron,  converts  into  beer  or  sugar  the 
malt  or  cane-juice,  which  he  has  previously  moved  to  the  spot. 
He  has  no  other  means  of  acting  on  matter  than  by  moving 
it.  Motion,  and  resistance  to  motion,  are  the  only  things  which 


26 


POLITICAL  ECONOMY 


his  muscles  are  constructed  for.  By  muscular  contraction  he 
can  create  a  pressure  on  an  outward  object,  which,  if  sufficiently 
powerful,  will  set  it  in  motion,  or  if  it  be  already  moving,  will 
check  or  modify  or  altogether  arrest  its  motion,  and  he  can 
do  no  more.  But  this  is  enough  to  have  given  all  the  command 
which  mankind  have  acquired  over  natural  forces  immeasur¬ 
ably  more  powerful  than  themselves ;  a  command  which,  great 
as  it  is  already,  is  without  doubt  destined  to  become  indefinitely 
greater.  He  exerts  this  power  either  by  availing  himself  of 
natural  forces  in  existence,  or  by  arranging  objects  in  those 
mixtures  and  combinations  by  which  natural  forces  are  gen¬ 
erated  ;  as  when  by  putting  a  lighted  match  to  fuel,  and  water 
into  a  boiler  over  it,  he  generates  the  expansive  force  of  steam, 
a  power  which  has  been  made  so  largely  available  for  the  at¬ 
tainment  of  human  purposes.* 

Labor,  then,  in  the  physical  world,  is  always  and  solely  em¬ 
ployed  in  putting  objects  in  motion;  the  properties  of  matter, 
the  laws  of  nature,  do  the  rest.  The  skill  and  ingenuity  of  hu¬ 
man  beings  are  chiefly  exercised  in  discovering  movements, 
practicable  by  their  powers,  and  capable  of  bringing  about  the 
effects  which  they  desire.  But,  while  movement  is  the  only  ef¬ 
fect  which  man  can  immediately  and  directly  produce  by  his 
muscles,  it  is  not  necessary  that  he  should  produce  directly  by 
them  all  the  movements  which  he  requires.  The  first  and  most 
obvious  substitute  is  the  muscular  action  of  cattle :  by  degrees 
the  powers  of  inanimate  nature  are  made  to  aid  in  this,  too,  as 
by  making  the  wind,  or  water,  things  already  in  motion,  com¬ 
municate  a  part  of  their  motion  to  the  wheels,  which  before  that 
invention  were  made  to  revolve  by  muscular  force.  This  ser¬ 
vice  is  extorted  from  the  powers  of  wind  and  water  by  a  set 
of  actions,  consisting  like  the  former  in  moving  certain  objects 
into  certain  positions  in  which  they  constitute  what  is  termed 
a  machine ;  but  the  muscular  action  necessary  for  this  is  not 
constantly  renewed,  but  performed  once  for  all,  and  there  is  on 
the  whole  a  great  economy  of  labor. 

§  3.  Some  writers  have  raised  the  question,  whether  nature 
gives  more  assistance  to  labor  in  one  kind  of  industry  or  in 
another ;  and  have  said  that  in  some  occupations  labor  does 
most,  in  others  nature  most.  In  this,  however,  there  seems 

*  This  essential  and  primary  law  of  a  fundamental  principle  of  Political 
man’s  power  over  nature  was,  I  believe.  Economy,  in  the  first  chapter  of  Mr. 
first  illustrated  and  made  prominent  as  Mill’s  “  Elements.” 


REQUISITES  OF  PRODUCTION 


27 


much  confusion  of  ideas.  The  part  which  nature  has  in  any 
work  of  man,  is  indefinite  and  incommensurable.  It  is  im¬ 
possible  to  decide  that  in  any  one  thing  nature  does  more  than 
in  any  other.  One  cannot  even  say  that  labor  does  less.  Less 
labor  may  be  required ;  but  if  that  which  is  required  is  abso¬ 
lutely  indispensable,  the  result  is  just  as  much  the  product  of 
labor,  as  of  nature.  When  two  conditions  are  equally  neces¬ 
sary  for  producing  the  effect  at  all,  it  is  unmeaning  to  say  that 
so  much  of  it  is  produced  by  one  and  so  much  by  the  other; 
it  is  like  attempting  to  decide  which  half  of  a  pair  of  scissors 
has  most  to  do  in  the  act  of  cutting;  or  which  of  the  factors, 
five  and  six,  contributes  most  to  the  production  of  thirty.  The 
form  which  this  conceit  usually  assumes,  is  that  of  supposing 
that  nature  lends  more  assistance  to  human  endeavors  in  agri¬ 
culture,  than  in  manufactures.  This  notion,  held  by  the  French 
Economistes,  and  from  which  Adam  Smith  was  not  free,  arose 
from  a  misconception  of  the  nature  of  rent.  The  rent  of  land 
being  a  price  paid  for  a  natural  agency,  and  no  such  price  being 
paid  in  manufactures,  these  writers  imagined  that  since  a  price 
was  paid,  it  was  because  there  was  a  greater  amount  of  service 
to  be  paid  for:  whereas  a  better  consideration  of  the  subject 
would  have  shown  that  the  reason  why  the  use  of  land  bears  a 
price  is  simply  the  limitation  of  its  quantity,  and  that  if  air,  heat, 
electricity,  chemical  agencies,  and  the  other  powers  of  nature 
employed  by  manufacturers,  were  sparingly  supplied,  and 
could,  like  land,  be  engrossed  and  appropriated,  a  rent  could  be 
exacted  for  them  also. 

§  4.  This  leads  to  a  distinction  which  we  shall  find  to  be  of 
primary  importance.  Of  natural  powers,  some  are  unlimited, 
others  limited  in  quantity.  By  an  unlimited  quantity  is,  of 
course,  not  meant  literally,  but  practically  unlimited :  a  quan¬ 
tity  beyond  the  use  which  can  in  any,  or  at  least  in  present  cir¬ 
cumstances,  be  made  of  it.  Land  is,  in  some  newly  settled 
countries,  practically  unlimited  in  quantity :  there  is  more  than 
can  be  used  by  the  existing  population  of  the  country,  or  by 
any  accession  likely  to  be  made  to  it  for  generations  to  come. 
But  even  there,  land  favorably  situated  with  regard  to  markets 
or  means  of  carriage,  is  generally  limited  in  quantity :  there  is 
not  so  much  of  it  as  persons  would  gladly  occupy  and  cultivate, 
or  otherwise  turn  to  use.  In  all  old  countries,  land  capable  of 
cultivation,  land  at  least  of  any  tolerable  fertility,  must  be 


28 


POLITICAL  ECONOMY 


ranked  among  agents  limited  in  quantity.  Water,  for  ordi¬ 
nary  purposes,  on  the  banks  of  rivers  or  lakes,  may  be  regarded 
as  of  unlimited  abundance ;  but  if  required  for  irrigation,  it 
may  even  there  be  insufficient  to  supply  all  wants,  while  in 
places  which  depend  for  their  consumption  on  cisterns  or  tanks, 
or  on  wells  which  are  not  copious,  or  are  liable  to  fail,  water 
takes  its  place  among  things  the  quantity  of  which  is  most 
strictly  limited.  Where  water  itself  is  plentiful,  yet  water¬ 
power,  i.e.  a  fall  of  water  applicable  by  its  mechanical  force  to 
the  service  of  industry,  may  be  exceedingly  limited,  compared 
with  the  use  which  would  be  made  of  it  if  it  were  more  abun¬ 
dant.  Coal,  metallic  ores,  and  other  useful  substances  found 
in  the  earth,  are  still  more  limited  than  land.  They  are  not 
only  strictly  local,  but  exhaustible ;  though,  at  a  given  place 
and  time,  they  may  exist  in  much  greater  abundance  than 
would  be  applied  to  present  use  even  if  they  could  be  obtained 
gratis.  Fisheries,  in  the  sea,  are  in  most  cases  a  gift  of  nature 
practically  unlimited  in  amount ;  but  the  Arctic  whale  fisheries 
have  long  been  insufficient  for  the  demand  which  exists  even 
at  the  very  considerable  price  necessary  to  defray  the  cost  of 
appropriation :  and  the  immense  extension  which  the  South¬ 
ern  fisheries  have  in  consequence  assumed,  is  tending  to  ex¬ 
haust  them  likewise.  River  fisheries  are  a  natural  resource  of 
a  very  limited  character,  and  would  be  rapidly  exhausted,  if 
allowed  to  be  used  by  every  one  without  restraint.  Air,  even 
that  state  of  it  which  we  term  wind,  may,  in  most  situations,  be 
obtained  in  a  quantity  sufficient  for  every  possible  use ;  and  so 
likewise,  on  the  sea-coast  or  on  large  rivers,  may  water  car¬ 
riage  :  though  the  wharfage  or  harbor-room  applicable  to  the 
service  of  that  mode  of  transport  is  in  many  situations  far  short 
of  what  would  be  used  if  easily  attainable. 

It  will  be  seen  hereafter  how  much  of  the  economy  of  so¬ 
ciety  depends  on  the  limited  quantity  in  which  some  of  the 
most  important  natural  agents  exist,  and  more  particularly, 
land.  For  the  present  I  shall  only  remark  that  so  long  as  the 
quantity  of  a  natural  agent  is  practically  unlimited,  it  cannot, 
unless  susceptible  of  artificial  monopoly,  bear  any  value  in  the 
market,  since  no  one  will  give  anything  for  what  can  be  ob¬ 
tained  gratis.  But  as  soon  as  a  limitation  becomes  practically 
operative ;  as  soon  as  there  is  not  so  much  of  the  thing  to  be 
had,  as  would  be  appropriated  and  used  if  it  could  be  obtained 


LABOR  AS  AN  AGENT  OF  PRODUCTION 


29 


for  asking ;  the  ownership  or  use  of  the  natural  agent  acquires 
an  exchangeable  value.  When  more  water-power  is  wanted 
in  a  particular  district,  than  there  are  falls  of  water  to  supply 
it,  persons  will  give  an  equivalent  for  the  use  of  a  fall  of  water. 
When  there  is  more  land  wanted  for  cultivation  than  a  place 
possesses,  or  than  it  possesses  of  a  certain  quality  and  certain 
advantages  of  situation,  land  of  that  quality  and  situation  may 
be  sold  for  a  price,  or  let  for  an  annual  rent.  This  subject  will 
hereafter  be  discussed  at  length ;  but  it  is  often  useful  to  an¬ 
ticipate,  by  a  brief  suggestion,  principles  and  deductions  which 
we  have  not  yet  reached  the  place  for  exhibiting  and  illustrat¬ 
ing  fully. 

Chapter  II. — Of  Labor  as  an  Agent  of  Production 

§  1.  The  labor  which  terminates  in  the  production  of  an 
article  fitted  for  some  human  use,  is  either  employed  directly 
about  the  thing,  or  in  previous  operations  destined  to  facilitate, 
perhaps  essential  to  the  possibility  of.^the  subsequent  ones.  In 
making  bread,  for  example,  the  labor  employed  about  the  thing 
itself  is  that  of  the  baker ;  but  the  labor  of  the  miller,  though 
employed  directly  in  the  production  not  of  bread  but  of  flour, 
is  equally  part  of  the  aggregate  sum  of  labor  by  which  the  bread 
is  produced  ;  as  is  also  the  labor  of  the  sower,  and  of  the  reaper. 
Some  may  think  that  all  these  persons  ought  to  be  considered 
as  employing  their  labor  directly  about  the  thing;  the  corn,  the 
flour,  and  the  bread  being  one  substance  in  three  different 
states.  Without  disputing  about  this  question  of  mere  lan¬ 
guage,  there  is  still  the  ploughman  who  prepared  the  ground 
for  the  seed,  and  whose  labor  never  came  in  contact  with  the 
substance  in  any  of  its  states ;  and  the  plough-maker,  whose 
share  in  the  result  was  still  more  remote.  ^\11  these  persons  ul¬ 
timately  derive  the  remuneration  of  their  labor  from  the  breads 
or  its  price :  the  plough-maker  as  much  as  the  rest :  for  since 
ploughs  are  of  no  use  ex^fp*  *nr  gr>i1  no  one  would, 

make  or  use  ploughs  for  any  other  reason  than  because  the  in¬ 

creased  returns,  thereby  obtained  from  the  ground,  afforded  a 
source  from  which  an  adequate  equivalent  could  be  assigned 
for  the  labor  of  the  plough-maker..  If  the  produce  is  to  be  used 
or  consumed  in  the  form  of  bread,  it  is  from  the  bread  that  this 
equivalent  must  come.  The  bread  must  suffice  to  remunerate 


3° 


POLITICAL  ECONOMY 


all  these  laborers,  and  several  others ;  such  as  the  carpenters 
and  bricklayers  who  erected  the  farm  buildings ;  the  hedgers 
and  ditchers  who  made  the  fences  necessary  for  the  protection 
of  the  crop ;  the  miners  and  smelters  who  extracted  or  pre¬ 
pared  the  iron  of  which  the  plough  and  other  implements  were 
made.  These,  however,  and  the  plough-maker,  do  not  depend 
for  their  remuneration  upon  the  bread  made  from  the  produce 
of  a  single  harvest,  but  upon  that  made  from  the  produce  of 
all  the  harvests  which  are  successively  gathered  until  the 
plough,  or  the  buildings  and  fences,  are  worn  out.  We  must 
add  yet  another  kind  of  labor ;  that  of  transporting  the  produce 
from  the  place  of  its  production  to  the  place  of  its  destined  use : 
the  labor  of  carrying  the  corn  to  market,  and  from  market  to 
the  miller’s,  the  flour  from  the  miller’s  to  the  baker’s,  and  the 
bread  from  the  baker’s  to  the  place  of  its  final  consumption. 
This  labor  is  sometimes  very  considerable :  flour  is  transported 
to  England  from  beyond  the  Atlantic,  corn  from  the  heart  of 
Russia ;  and  in  addition  to  the  laborers  immediately  employed, 
the  wagoners  and  sailor^,  there  are  also  costly  instruments, 
such  as  ships,  in  the  construction  of  which  much  labor  has  been 
expended :  that  labor,  however,  not  depending  for  its  whole 
remuneration  upon  the  bread,  but  for  a  part  only;  ships  being 
usually,  during  the  course  of  their  existence,  employed  in  the 
transport  of  many  different  kinds  of  commodities. 

^0  estimate^  therefore,  the  labor  of  which  any  given  com¬ 
modity  is  the  result,  is  far  from  a  simple  operation.  The  items 
in  the  calculation  are  very  numerous — as  it  may  seem  to  some 
persons,  infinitely  so ;  for  if,  as  a  part  of  the  labor  employed  in 
making  bread,  we  count  the  labor  of  the  blacksmith  who  made 
the  plough,  why  not  also  (it  may  be  asked)  the  labor  of  making 
the  tools  used  by  the  blacksmith,  and  the  tools  used  in  making 
those  tools,  and  so  back  to  the  origin  of  things?  But  after 
mounting  one  or  two  steps  in  this  ascending  scale,  we  come 
into  a  region  of  fractions  too  minute  for  calculation.  Suppose, 
for  instance,  that  the  same  plough  will  last,  before  being  worn 
out,  a  dozen  years.  Only  one-twelfth  of  the  labor  of  making 
the  plough  must  be  placed  to  the  account  of  each  year’s  harvest. 
A  twelfth  part  of  the  labor  of  making  a  plough  is  an  appre¬ 
ciable  quantity.  But  the  same  set  of  tools,  perhaps,  suffice  to 
the  plough-maker  for  forging  a  hundred  ploughs,  which  serve 
during  the  twelve  years  of  their  existence  to  prepare  the  soil  of 


LABOR  AS  AN  AGENT  OF  PRODUCTION 


3i 


as  many  different  farms.  A  twelve-hundredth  part  of  the  labor 
of  making  his  tools,  is  as  much,  therefore,  as  has  been  ex¬ 
pended  in  procuring  one  year’s  harvest  of  a  single  farm :  and 
when  this  fraction  comes  to  be  further  apportioned  among  the  , 
various  sacks  of  corn  and  loaves  of  bread,  it  is  seen  at  once  that 
such  quantities  are  not  worth  taking  into  the  account  for  any 
practical  purpose  connected  with  the  commodity.  It  is  true 
that  if  the  tool-maker  had  not  labored,  the  corn  and  bread 
never  would  have  been  produced ;  but  they  will  not  be  sold  a 
tenth  part  of  a  farthing  dearer  in  consideration  of  his  labor. 

§  2.  Another  of  the  modes  in  which  labor  is  indirectly  or 
remotely  instrumental  to  the  production  of  a  thing,  requires 
particular  notice :  namely,  when  it  is  employed  in  producing 
subsistence,  to  maintain  the  laborers  while  they  are  engaged 

in  the  production.  This  previous  employment  of  labor  is  an 
indispensable  condition  to  every  productive  operation,  on  any 

other  than  the  very  smallest  scale.  Except  the  labor  of  the 
hunter  and  fisher,  there  is  scarcely,  any  kind  of  labor  to  which 
the  returns  are  immediate.  Productive  operations  require  to 
be  continued  a  certain  time,  before  their  fruits  are  obtained. 
Unless  the  laborer,  before  commencing  his  work,  possesses  a 
store  of  food,  or  can  obtain  access  to  the  stores  of  some  one 
else,  in  sufficient  quantity  to  maintain  him  until  the  produc¬ 
tion  is  completed,  he  can  undertake  no  labor  but  such  as  can 
be  carried  on  at  odd  intervals,  concurrently  with  the  pursuit  of 
his  subsistence.  Pie  cannot  obtain  food  itself  in  any  abun¬ 
dance  ;  for  every  mode  of  so  obtaining  it,  requires  that  there  be 
already  food  in  store.  Agriculture  only  brings  forth  food  after 
the  lapse  of  months  ;  and  though  the  labors  of  the  agriculturist 
are  not  necessarily  continuous  during  the  whole  period,  they 
must  occupy  a  considerable  part  of  it.  Not  only  is  agriculture 
impossible  without  food  produced  in  advance,  but  there  must, 
be  a  very  great  quantity  in  advance  to  enable  any  considerable 
community  to  support  itself  wholly  by  agriculture.  A  country 
like  England  or  France  is  only  able  to  carry  on  the  agriculture 
of  the  present  year,  because  that  of  past  years  has  provided, 
in  those  countries  or  somewhere  else,  sufficient  food  to  sup¬ 
port  their  agricultural  population  until  the  next  harvest.  They 
are  only  enabled  to  produce  so  many  other  things  besides  food, 
because  the  food  which  was  in  store  at  the  close  of  the  last  har¬ 
vest  suffices  to  maintain  not  only  the  agricultural  laborers,  but 
a  large  industrious  population  besides. 


32 


POLITICAL  ECONOMY 


The  labor  employed  in  producing  this  stock  of  subsistence, 
forms  a  great  and  important  part  of  the  past  labor  which  has 
been  necessary  to  enable  present  labor  to  be  carried  on.  But 
there  is  a  difference,  requiring  particular  notice,  between  this 
^nd  the  other  kinds  of  previous  orjpreparato'ry  lalJor^The 
miller,  the  reaper,  the  ploughman,  the  plough-maker,  the^  wag¬ 
oner  and'w^on'mTffkeTTTven THFTailor  andshipbuilder  when 
dftyM6yed,  derive  TftgtT  f enumeration  irom  the  ultimate  product 
— the  bread  made  Irom  the *cbrtl  Oil  which  they  have  severally 
operated,  or  supplied  tne  instruments  lor  operating.  The 
labor  thaFproduced  the  food  which  led  all  these  laborers,  is  as 
necessary  to  the  ultimate  result,  the  bread  of  the  present  har¬ 
vest,  as  any  of  those  other  portions  of  labor ;  but  is  not,  like  * 
them,  remunerated  from  it.  That  previous  labor  has  received 
its  remuneration  from  the  previous  food.  In  order  to  raise 
any  product,  there  are  needed  labor,  tools,  and  materials,  and 
food  to  feed  the  laborers.  But  the  tools  and  materials  are  of 

* 

no  use  except  for  obtaining  the  product,  or  at  least  are  to  be 
applied  to  no  other  use,  and  the  labor  of  their  construction  can 
be  remunerated  only  from  the  product  when  obtained.  The 
food,  on  the  contrary,  is  intrinsically  useful,  and  is  applied  to 
the  direct  use  of  feeding  human  beings.  The  labor  expended 
in  producing  the  food,  and  recompensed  by  it,  needs  not  be 
remunerated  over  again  from  the  produce  of  the  subsequent 
labor  which  it  has  fed.  If  we  suppose  that  the  same  body  of 
laborers  carried  on  a  manufacture,  and  grew  food  to  sustain 
themselves  while  doing  it,  they  have  had  for  their  trouble  the 
food  and  the  manufactured  article ;  but  if  they  also  grew  the 
material  and  made  the  tools,  they  have  had  nothing  for  that 
trouble  but  the  manufactured  article  alone. 

The  claim  to  remuneration  founded  on  the  possession  of 
food,  available  for  the  maintenance  of  laborers,  is  of  another 
IFindf  remunerationTfor  abstinence,  not  for  labor.  Tf  a  person 
has  a  store  of  food,  he  has  it  in  his  power  to  consume  it  him- 
self  in  idleness,  or  in  feeding  others  to  attend  on  him,  or  to 
fight  for  him,  or  to  sing  or  dance  for  him.  If,  instead  of  these; 
things,  he  gives  it  to  productive  laborers  to  support  them  dur¬ 
ing  their  work,  he  can,  and  naturally  will,  claim  a  remunera- 
. tion  from  the  produce.  He  will  not  be  content  with  simple  Re¬ 
payment  ;  if  he  receives  merely  that,  he  is  only  in  the  same 
situation  as  at  first,  and  has  derived  no  advantage  from  delay- 


LABOR  AS  AN  AGENT  OF  PRODUCTION 


33 


ing  to  apply  his  savings  to  his  own  benefit  or  pleasure.  He  will 
look  for  some  equivalent  for  this  forbearance :  he  will  expect 
his  advance  of  food  to  come  back  to  him  with  an  increase,  called 
in  the  language  of  business,  a  profit ;  and  the  hope  of  this  profit 
will  generally  have  been  a  part  of  the  inducement  which  made 
him  accumulate  a  stock,  by  economizing  in  his  own  consump¬ 
tion  ;  or,  at  any  rate,  which  made  him  forego  the  application 
of  it,  when  accumulated,  to  his  personal  ease  or  satisfaction. 
The  food  also  which  maintained  other  workmen  while  produc¬ 
ing  the  tools  or  materials,  must  have  been  provided  in  advance 
by  some  one,  and  he,  too,  must  have  his  profit  from  the  ulti¬ 
mate  product ;  but  there  is  this  difference,  that  here  the  ulti¬ 
mate  product  has  to  supply  not  only  the  profit,  but  also  the 
remuneration  of  the  labor.  The  tool-maker  (say,  for  instance, 
the  plough-maker)  does  not  indeed  usually  wait  for  his  pay¬ 
ment  until  the  harvest  is  reaped ;  the  farmer  advances  it  to  him, 
and  steps  into  his  place  by  becoming  the  owner  of  the  plough. 
Nevertheless,  it  is  from  the  harvest  that  the  payment  is  to 
come,  since  the  farmer  would  not  undertake  this  outlay  unless 
he  expected  that  the  harvest  would  repay  him,  and  with  a  profit 
too  on  this  fresh  advance ;  that  is,  unless  the  harvest  would 
yield,  besides  the  remuneration  of  the  farm  laborers  (and  a 
profit  for  advancing  it),  a  sufficient  residue  to  remunerate  the 
plough-maker’s  laborers,  give  the  plough-maker  a  profit,  and 
a  profit  to  the  farmer  on  both. 

§  3.  From  these  considerations  it  appears,  that  in  an  enu¬ 
meration  and  classification  of  the  kinds  of  industry  which  are 
intended  for  the  indirect  or  remote  furtherance  of  other  prq- 

ductive  labor,  we  need  not  include  the  labor  of  producing  sub¬ 
sistence  or  other  necessaries  of  life  to  be  consumed  by  produc¬ 
tive  laborers ;  for  the  main  end  and  purpose  of  this  labor  is 
the  subsistence  itself ;  and  though  the  possession  of  a  store 
of  it  enables  other  work  to  be  done,  this  is  but  an  incidental 
consequence.  The  remaining  modes  in  which  labor  is  indi¬ 
rectly  instrumental  to  production,  mav  be  arranged  under  fivg 

heads. 

- - 

FirsL  Labor  employed  in  producing  materials,  on  which 
industry  is  to  be  afterwards  employed.  This  is,  in  many  cases, 
a  labor  of  mere  appropriation ;  extractive  industry,  as  it  has 
been  aptly  named  by  M.  Dunoyer.  The  labor  of  the  miner,  for 
example,  consists  of  operations  for  digging  out  of  the  earth 
Vol.  I. — 3 


34 


POLITICAL  ECONOMY 


substances  convertible  by  industry  into  various  articles  fitted 
for  human  use.  Extractive  industry,  however,  is  not  confined 
to  the  extraction  of  materials.  Coal,  for  instance,  is  employed, 
not  only  in  the  processes  of  industry,  but  in  directly  warming 
human  beings.  When  so  used,  it  is  not  a  material  of  produc¬ 
tion,  but  is  itself  the  ultimate  product.  So,  also,  in  the  case 
of  a  mine  of  precious  stones.  These  are  to  some  small  extent 
employed  in  the  productive  arts,  as  diamonds  by  the  glass-cut¬ 
ter,  emery  and  corundum  for  polishing,  but  their  principal 
destination,  that  of  ornament,  is  a  direct  use ;  though  they 
commonly  require,  before  being  so  used,  some  process  of  man¬ 
ufacture,  which  may  perhaps  warrant  our  regarding  them  as 
materials.  Metallic  ores  of  all  sorts  are  materials  merely. 

Under  the  head,  production  of  materials,  we  must  include 
the  industry  of  the  wood-cutter,  when  employed  in  cutting  and 
preparing  timber  for  building,  or  wood  for  the  purpose  of  the 
carpenter’s  or  any  other  art.  In  the  forests  of  America,  Nor¬ 
way,  Germany,  the  Pyrenees,  and  Alps,  this  sort  of  labor  is 
largely  employed  on  trees  of  spontaneous  growth.  In  other 
cases,  we  must  add  to  the  labor  of  the  wood-cutter  that  of  the 
planter  and  cultivator. 

Under  the  same  head  are  also  comprised  the  labors  of  the 
agriculturists  in  growing  flax,  hemp,  cotton,  feeding  silk¬ 
worms,  raising  food  for  cattle,  producing  bark,  dye-stuffs,  some 
oleaginous  plants,  and  many  other  things  only  useful  because 
required  in  other  departments  of  industry.  So,  too,  the  labor 
of  the  hunter,  as  far  as  his  object  is  furs  or  feathers;  of  the 
shepherd  and  the  cattle-breeder,  in  respect  of  wool,  hides,  horn, 
bristles,  horse-hair,  and  the  like.  The  things  used  as  materials 
in  some  process  or  other  of  manufacture  are  of  a  most  miscel¬ 
laneous  character,  drawn  from  almost  every  quarter  of  the 
animal,  vegetable,  and  mineral  kingdoms.  And  besides  this, 
the  finished  products  of  many  branches  of  industry  are  the  ma¬ 
terials  of  others.  The  thread  produced  by  the  skinner  is  applied 
to  hardly  any  use  except  as  material  for  the  weaver.  Even  the^ 
product  of  the  loom  is  chiefly  used  as  material  for  the  fabrica¬ 
tors  of  articles  of  dress  or  furniture,  or  of  further  instruments 
of  productive  industry,  as  in  the  case  of  the  sail-maker.  The 
currier  and  tanner  find  their  whole  occupation  in  converting 
raw  material  into  what  may  be  termed  prepared  material.  In 
strictness  of  speech,  almost  all  food,  as  it  comes  from  the  hands 


LABOR  AS  AN  AGENT  OF  PRODUCTION 


35 

of  the  agriculturist,  is  nothing  more  than  material  for  the  occu¬ 
pation  of  the  baker  or  the  cook. 

§  4.  The  second  kind  of  indirect  labor  is  that  employed  in 
making  tools  or  implements  for  the  assistance  of  labor.  I  use 
these  terms  in  their  most  comprehensive  sense,  embracing  all 
permanent  instruments  or  helps  to  production,  from  a  flint  and 
steel  for  striking  a  light,  to  a  steamship,  or  the  most  complex 
apparatus  of  manufacturing  machinery.  There  may  be  some 
hesitation  where  to  draw  the  line  between  implements  and  ma¬ 
terials;  and  some  things  used  in  production  (such  as  fuel) 
would  scarcely  in  common  language  be  called  by  either  name, 
popular  phraseology  being  shaped  out  by  a  different  class  of 
necessities  from  those  of  scientific  exposition.  To  avoid  a 
multiplication  of  classes  and  denominations  answering  to  dis¬ 
tinctions  of  no  scientific  importance,  political  economists  gen¬ 
erally  include  all  things  which  are  used  as  immediate  means 
of  production  (the  means  which  are  not  immediate  will  be  con¬ 
sidered  presently)  either  in  the  class  of  implements  or  in  that 
of  materials.  Perhaps  the  line  is  most  usually  and  most  con¬ 
veniently  drawn,  by  considering  as  a  material  every  instrument 
of  production  which  can  only  be  used  once,  being  destroyed 
(at  least  as  an  instrument  for  the  purpose  in  hand)  by  a  single 
employment.  Thus  fuel,  once  burnt,  cannot  be  again  used  as 
fuel ;  what  can  be  so  used  is  only  any  portion  which  has  re¬ 
mained  unburnt  the  first  time.  And  not  only  it  cannot  be  used 
without  being  consumed,  but  it  is  only  useful  by  being  con¬ 
sumed  ;  for  if  no  part  of  the  fuel  were  destroyed,  no  heat  would 
be  generated.  A  fleece,  again,  is  destroyed  as  a  fleece  by  being 
spun  into  thread ;  and  the  thread  cannot  be  used  as  thread 
when  woven  into  cloth.  But  an  axe  is  not  destroyed  as  an  axe 
by  cutting  down  a  tree :  it  may  be  used  afterwards  to  cut  down 
a  hundred  or  a  thousand  more ;  and  though  deteriorated  in 
some  small  degree  by  each  use,  it  does  not  do  its  work  by  being 
deteriorated,  as  the  coal  and  the  fleece  do  theirs  by  being  de¬ 
stroyed  ;  on  the  contrary,  it  is  the  better  instrument  the  better 
it  resists  deterioration.  There  are  some  things,  rightly  classed 
as  materials,  which  may  be  used  as  such  a  second  and  a  third 
time,  but  not  while  the  product  to  which  they  at  first  contrib¬ 
uted  remains  in  existence.  The  iron  which  formed  a  tank  or 
a  set  of  pipes  may  be  melted  to  form  a  plough  or  a  steam  en¬ 
gine  ;  the  stones  with  which  a  house  was  built  may  be  used  after 


3^ 


POLITICAL  ECONOMY 


it  is  pulled  down,  to  build  another.  But  this  cannot  be  done 
while  the  original  product  subsists ;  their  function  as  materials 
is  suspended,  until  the  exhaustion  of  the  first  use.  Not  so  with 
the  things  classed  as  implements ;  they  may  be  used  repeatedly 
for  fresh  work,  until  the  time,  sometimes  very  distant,  at  which 
they  are  worn  out,  while  the  work  already  done  by  them  may 
subsist  unimpaired,  and  when  it  perishes,  does  so  by  its  own 
laws,  or  by  casualties  of  its  own.* 

The  only  practical  difference  of  much  importance  arising 
from  the  distinction  between  materials  and  implements,  is  one 
which  has  attracted  our  attention  in  another  case.  Since  ma¬ 
terials  are  destroyed  as  such  by  being  once  used,  the  whole  of 
the  labor  required  for  their  production,  as  well  as  the  absti¬ 
nence  of  the  person  who  supplied  the  means  of  carrying  it  on, 
must  be  remunerated  from  the  fruits  of  that  single  use.  Imple¬ 
ments,  on  the  contrary,  being  susceptible  of  repeated  employ¬ 
ment,  the  whole  of  the  products  which  they  are  instrumental 
in  bringing  into  existence  are  a  fund  which  can  be  drawn  upon 
to  remunerate  the  labor  of  their  construction,  and  the  absti¬ 
nence  of  those  by  whose  accumulations  that  labor  was  sup¬ 
ported.  It  is  enough  if  each  product  contributes  a  fraction, 
commonly  an  insignificant  one,  towards  the  remuneration  of 
that  labor  and  abstinence,  or  towards  indemnifying  the  imme¬ 
diate  producer  for  advancing  that  remuneration  to  the  person 
who  produced  the  tools. 

§  5-  Thirdly :  Besides  materials  for  industry  to  employ  itself 
on,  and  implements  to  aid  it,  provision  must  be  made  to  pre¬ 
vent  its  operations  from  being  disturbed  and  its  products  in¬ 
jured,  either  by  the  destroying  agencies  of  nature,  or  by  the 
violence  or  rapacity  of  men.  This  gives  rise  to  another  mode 
in  which  labor  not  employed  directly  about  the  product  itself, 
is  instrumental  to  its  production ;  namely,  when  employed 
for  the  protection  of  industry.  Such  is  the  object  of  all  build- 
ings  for  industrial  purposes ;  all  manufactories,  warehouses, 


*  The  able  and  friendly  reviewer  of 
this  treatise  in  the  Edinburgh  “  Review  ” 
(October,  1848)  conceives  the  distinction 
between  materials  and  implements 
rather  differently:  proposing  to  con¬ 
sider  as  materials  “  all  the  things  which, 
after  having  undergone  the  change  im¬ 
plied  in  production,  are  themselves  mat¬ 
ter  of  exchange,”  and  as  implements  (or 
instruments)  “  the  things  which  are  em¬ 
ployed  in  producing  that  change,  but  do 


not  themselves  become  part  of  the  ex¬ 
changeable  result.”  According  to  these 
definitions,  the  fuel  consumed  in  a  man¬ 
ufactory  would  be  considered,  not  as  a 
material,  but  as  an  instrument.  This 
use  of  the  terms  accords  better  than  that 
proposed  in  the  text,  with  the  primitive 
physical  meaning  of  the  word  “  mate¬ 
rial  ”;  but  the  distinction  on  which  it  is 
grounded  is  one  almost  irrelevant  to 
political  economy. 


LABOR  AS  AN  AGENT  OF  PRODUCTION 


37 


docks,  granaries,  barns,  farm  buildings  devoted  to  cattle,  or 
to  the  operations  of  agricultural  labor.  I  exclude  those  tn 
which  the  laborers  live,  or  which  are  destined  for  their  personal 
accommodation :  these,  like  their  food,  supply  actual  wants, 
and  must  be  counted  in  the  remuneration  of  their  labor.  There 
are  many  modes  in  which  labor  is  still  more  directly  applied  to 
the  protection  of  productive  operations.  The  herdsman  has 
little  other  occupation  than  to  protect  the  cattle  from  harm : 
the  positive  agencies  concerned  in  the  realization  of  the  prod¬ 
uct,  go  on  nearly  of  themselves.  I  have  already  mentioned 
the  labor  of  the  hedger  and  ditcher,  of  the  builder  of  walls  or 
dikes.  To  these  must  be  added  that  of  the  soldier,  the  police¬ 
man,  and  the  judge.  These  functionaries  are  not  indeed  em¬ 
ployed  exclusively  in  the  protection  of  industry,  nor  does  their 
payment  constitute,  to  the  individual  producer,  a  part  of  the  ex¬ 
penses  of  production.  But  they  are  paid  from  the  taxes,  which 
are  derived  from  the  produce  of  industry ;  and  in  any  tolerably 
governed  country  they  render  to  its  operations  a  service  far 
more  than  equivalent  to  the  cost.  To  society  at  large  they  are, 
therefore,  part  of  the  expenses  of  production :  and  if  the  re¬ 
turns  to  production  were  not  sufficient  to  maintain  these  labor¬ 
ers  in  addition  to  all  the  others  required,  production,  at  least 
in  that  form  and  manner,  could  not  take  place.  Besides,  if  the 
protection  which  the  government  affords  to  the  operations  of 
industry  were  not  afforded,  the  producers  would  be  under  a 
necessity  of  either  withdrawing  a  large  share  of  their  time  and 
labor  from  production,  to  employ  it  in  defence,  or  of  engaging 
armed  men  to  defend  them ;  all  which  labor,  in  that  case,  must 
be  directly  remunerated  from  the  produce ;  and  things  which 
could  not  pay  for  this  additional  labor,  would  not  be  produced. 
Under  the  present  arrangements,  the  product  pays  its  quota 
towards  the  same  protection,  and,  notwithstanding  the  waste 
and  prodigality  incident  to  government  expenditure,  obtains 
it  of  better  quality  at  a  much  smaller  cost. 

§  6.  Fourthly :  There  is  a  very  great  amount  of  labor  em¬ 
ployed,  not  in  bringing  the  product  into  existence,  but  in  ren¬ 
dering  it,  when  in  existence,  accessible  to  those  for  whose  use 
it  is  intended.  Many  important  classes  of  laborers  find  their 
sole  employment  in  some  function  of  this  kind.  There  is  first 
the  whole  class  of  carriers,  by  land  or  water :  muleteers,  wag- 
oners,  bargemen,  sailors,  wharfmen,  coal-heavers,  porters, 


38 


POLITICAL  ECONOMY 


railway  establishments,  and  the  lik^  Next,  there  are  the  con¬ 
structors  of  all  the  implements  of  transport ;  ships,  barges, 
carts,  locomotives,  etc.,  to  which  must  be  added  roads,  canals, 
and  railways.  Roads  are  sometimes  made  by  the  government, 
and  opened  gratuitously  to  the  public ;  but  the  labor  of  making 
them  is  not  the  less  paid  for  from  the  produce.  Each  producer, 
in  paying  his  quota  of  the  taxes  levied  generally  for  the  con¬ 
struction  of  roads,  pays  for  the  use  of  those  which  conduce  to 
his  convenience ;  and  if  made  with  any  tolerable  judgment, 
they  increase  the  returns  to  his  industry  by  far  more  than  an 
equivalent  amount. 

Another  numerous  class  of  laborers  employed  in  rendering 
the  things  produced  accessible  to  their  intended  consumers,  is 
the  class  of  dealers  and  traders,  or,  as  they  may  be  termed,  .diSi 
tributors.  There  would  be  a  great  waste  of  time  and  trouble, 
and  an  inconvenience  often  amounting  to  impracticability,  if 
consumers  could  only  obtain  the  articles  they  want  by  treating 
directly  with  the  producers.  Both  producers  and  consumers 
are  too  much  scattered,  and  the  latter  often  at  too  great  a  dis¬ 
tance  from  the  former.  To  diminish  this  loss  of  time  and 
labor,  the  contrivance  of  fairs  and  markets  was  early  had  re¬ 
course  to,  where  consumers  and  producers  might  periodically 
meet,  without  any  intermediate  agency ;  and  this  plan  answers 
tolerably  well  for  many  articles,  especially  agricultural  produce, 
agriculturists  having  at  some  seasons  a  certain  quantity  of 
spare  time  on  their  hands.  But  even  in  this  case,  attendance  is 
often  very  troublesome  and  inconvenient  to  buyers  who  have 
other  occupations,  and  do  not  live  in  the  immediate  vicinity ; 
while,  for  all  articles  the  production  of  which  requires  contin¬ 
uous  attention  from  the  producers,  these  periodical  markets 
must  be  held  at  such  considerable  intervals,  and  the  wants  of 
the  consumers  must  either  be  provided  for  so  long  beforehand, 
or  must  remain  so  long  unsupplied,  that  even  before  the  re¬ 
sources  of  society  admitted  of  the  establishment  of  shops,  the 
supply  of  these  wants  fell  universally  into  the  hands  of  itinerant 
dealers ;  the  pedler,  who  might  appear  once  a  month,  being 
preferred  to  the  fair,  which  only  returned  once  or  twice  a  year. 
In  country  districts,  remote  from  towns  or  large  villages,  the 
industry  of  the  pedler  is  not  yet  wholly  superseded.  But  a 
dealer  who  has  a  fixed  abode  and  fixed  customers  is  so  much* 
more  to  be  depended  on,  that  consumers  prefer  resorting  to 


LABOR  AS  AN  AGENT  OF  PRODUCTION 


39 


him  if  he  is  conveniently  accessible ;  and  dealers,  therefore, 
find  their  advantage  in  establishing  themselves  in  every  local¬ 
ity  where  there  are  sufficient  consumers  near  at  hand  to  afford 
them  a  remuneration. 

In  many  cases  the  producers  and  dealers  are  the  same  per¬ 
sons,  at  least  as  to  the  ownership  of  the  funds  and  the  control 
of  the  operations.  The  tailor,  the  shoemaker,  the  baker,  and 
many  other  tradesmen,  are  the  producers  of  the  articles  they 
deal  in,  so  far  as  regards  the  last  stage  in  the  production.  This 
union,  however,  of  the  functions  of  manufacturer  and  retailer, 
is  only  expedient  when  the  article  can  advantageously  be  made 
at  or  near  the  place  convenient  for  retailing  it,  and  is,  besides, 
manufactured  and  sold  in  small  parcels.  When  things  have 
to  be  brought  from  a  distance,  the  same  person  cannot  effectu¬ 
ally  superintend  both  the  making  and  the  retailing  of  them : 
when  they  are  best  and  most  cheaply  made  on  a  large  scale,  a 
single  manufactory,  requires  so  many  local  channels  to  carry 
off  its  supply,  that  the  retailing  is  most  conveniently  delegated 
to  other  agency :  and  even  shoes  and  coats,  when  they  are  to 
be  furnished  in  large  quantities  at  once,  as  for  the  supply  of  a 
regiment  or  of  a  workhouse,  are  usually  obtained  not  directly 
from  the  producers,  but  from  intermediate  dealers,  who  make 
it  their  business  to  ascertain  from  what  producers  they  can  be 
obtained  best  and  cheapest.  Even  when  things  are  destined 
to  be  at  last  sold  by  retail,  convenience  soon  creates  a  class  of 
wholesale  dealers.  When  products  and  transactions  have  mul¬ 
tiplied  beyond  a  certain  point ;  when  one  manufactory  sup¬ 
plies  many  shops,  and  one  shop  has  often  to  obtain  goods  from 
many  different  manufactories,  the  loss  of  time  and  trouble  both 
to  the  manufacturers  and  to  the  retailers  by  treating  directly 
with  one  another,  makes  it  more  convenient  to  them  to  treat 
with  a  smaller  number  of  great  dealers  or  merchants,  who  only 
buy  to  sell  again,  collecting  goods  from  the  various  producers, 
and  distributing  them  to  the  retailers,  to  be  by  them  further 
distributed  among  the  consumers.  Of  these  various  elements 
is  composed  the  Distributing  Class,  whose  agency  is  supple¬ 
mentary  to  that  of  the  Producing  Glass :  and  the  produce  so 
distributed,  or  its  price,  is  the  source  from  which  the  distrib¬ 
utors  are  remunerated  for  their  exertions,  and  for  the  ab¬ 
stinence  which  enabled  them  to  advance  the  funds  needful  for 
the  business  of  distribution. 


40 


POLITICAL  ECONOMY 


§  7.  We  have  now  completed  the  enumeration  of  the  modes 
in  which  labor  employed  on  external  nature  is  subservient  to 
production.  But  there  is  yet  another  mode  of  employing  labor 
which  conduces  equally,  though  still  more  remotely,  to  that 
end :  this  is,  labor  of  which  the  subject  is  human  beings.  Every 
human  being  has  been  brought  up  from  infancy  at  the  expense 
of  much  labor  to  some  person  or  persons,  and  if  this  labor  or 
part  of  it  had  not  been  bestowed,  the  child  would  never  have 
attained  the  age  and  strength  which  enable  him  to  become  a 
laborer  in  his  turn.  To  the  community  at  large,  the  labor  and 
expense  of  rearing  its  infant  population  form  a  part  of  the  out¬ 
lay  which  is  a  condition  of  production,  and  which  is  to  be  re¬ 
placed  with  increase  from  the  future  produce  of  their  labor. 
By  the  individuals,  this  labor  and  expense  are  usually  incurred 
from  other  motives  than  to  obtain  such  ultimate  return,  and, 
for  most  purposes  of  political  economy,  need  not  be  taken  into 
account  as  expenses  of  production.  But  Ijie  technical  or  in¬ 
dustrial  education  of  the  community ;  the  labor  employed  in 
learning  and  in  teaching  the  arts  of  production,  in  acquiring 
and  communicating  skill  m  those  arts^  this  labor  is  really, 
and  in  general  solely,  undergone  for  the  sake  of  the  greater  or 
more  valuable  produce  thereby  attained,  and  in  order  that  a 
remuneration,  equivalent  or  more  than  equivalent,  may  be 
reaped  by  the  learner,  besides  an  adequate  remuneration  for 
tfie  laboF  of  tfie  teacher,  when  a  teacher  has  been  employed. 

As  the  labor  which  confers  productive  powers' whether  of 
hand  or  of  head,  may  be  looked  upon  as  part  of  the  labor  by 
which  society  accomplishes  its  productive  operations,  or  in 
other  words,  as  part  of  what  the  produce  costs  to  society,  so, 
too,  may  the  labor  employed  in  keeping  up  productive  powers  ; 
in  preventing  them  from  being  destroyed  or  weakened  by  acci¬ 
dent  or  disease.  The  labor  of  a  physician  or  surgeon,  when 
made  use  of  by  persons  engaged  in  industry,  must  be  regarded 
in  the  economy  of  society  as  a  sacrifice  incurred,  to  preserve 
from  perishing  by  death  or  infirmity  that  portion  of  the  produc¬ 
tive  resources  of  society  which  is  fixed  in  the  lives  and  bodily  or 
mental  powers  of  its  productive  members.  To  the  individuals, 
indeed,  this  forms  but  a  part,  sometimes  an  imperceptible  part, 
of  the  motives  that  induce  them  to  submit  to  medical  treatment : 
it  is  not  principally  from  economical  motives  that  persons  have 
a  limb  amputated,  or  endeavor  to  be  cured  of  a  fever,  though 


LABOR  AS  AN  AGENT  OF  PRODUCTION 


4i 


when  they  do  so  there  is  generally  sufficient  inducement  for 
it  even  on  that  score  alone.  This  is,  therefore,  one  of  the  cases 
of  labor  and  outlay  which,  though  conducive  to  production, 
yet  not  being  incurred  for  that  end,  or  for  the  sake  of  the  re¬ 
turns  arising  from  it,  are  out  of  the  sphere  of  most  of  the  gen¬ 
eral  propositions  which  political  economy  has  occasion  to  as¬ 
sert  respecting  productive  labor :  though,  when  society  and 
not  the  individuals  are  considered,  this  labor  and  outlay  must 
be  regarded  as  part  of  the  advance  by  which  society  effects  its 
productive  operations,  and  for  which  it  is  indemnified  by  the 
produce. 

§  8.  Another  kind  of  labor,  usually  classed  as  mental,  but 
conducing  to  the  ultimate  product  as  directly,  though  not  so 
immediately,  as  manual  labor  itself,  is  the  labor  of  the  inventors 
of  industrial  processes.  I  say,  usually  classed  as  mental,  be¬ 
cause  in  reality  it  is  not  exclusively  so.  All  human  exertion  is 
compounded  of  some  mental  and  some  bodily  elements.  The 
stupidest  hodman,  who  repeats  from  day  to  day  the  mechanical 
act  of  climbing  a  ladder,  performs  a  function  partly  intellectual ; 
so  much  so,  indeed,  that  the  most  intelligent  dog  or  elephant 
could  not,  probably,  be  taught  to  do  it.  The  dullest  human  be¬ 
ing,  instructed  beforehand,  is  capable  of  turning  a  mill ;  but  a 
horse  cannot  turn  it  without  somebody  to  drive  and  watch 
him.  On  the  other  hand,  there  is  some  bodily  ingredient  in  the 
labor  most  purely  mental,  when  it  generates  any  external  result. 
Newton  could  not  have  produced  the  “  Principia  ”  without 
the  bodily  exertion  either  of  penmanship  or  of  dictation ;  and 
he  must  have  drawn  many  diagrams,  and  written  out  many 
calculations  and  demonstrations,  while  he  was  preparing  it  in 
his  mind.  Inventors,  besides  the  labor  of  their  brains,  generally 
go  through  much  labor  with  their  hands,  in  the  models  which 
they  construct  and  the  experiments  they  have  to  make  before 
their  idea  can  realize  itself  successfully  in  act.  Whether  men¬ 
tal,  however,  or  bodily,  their  labor  is  a  part  of  that  by  which  the 
production  is  brought  about.  The  labor  of  Wattpn  contriving 
the  steam-engine  was  as  essential  a  part  of  production  as  that 
of  the  mechanics  who  build  or  the  engineers  who  work  the 
instrument ;  and  was  undergone,  no  less  than  theirs,  in  the 
prospect  of  a  remuneration  from  the  produce.  The  labor  of 
invention  is  often  estimated  and  paid  on  the  very  same  plan 
as  that  of  execution.  Many  manufacturers  of  ornamental 


42 


POLITICAL  ECONOMY 


goods  have  inventors  in  their  employment,  who  receive  wages 
or  salaries  for  designing  patterns,  exactly  as  others  do  for 
copying  them.  All  this  is  strictly  part  of  the  labor  of  produc¬ 
tion  ;  as  the  labor  of  the  author  of  a  book  is  equally  a  part  of 
its  production  with  that  of  the  printer  and  binder. 

In  a  national,  or  universal  point  of  view,  the  labor  of  the 
savant,  or  speculative  thinker,  is  as  much  a  part  of  production 
in  the  very  narrowest  sense,  as  that  of  the  inventor  of  a  practical 
art ;  many  such  inventions  having  been  the  direct  consequences 
of  theoretic  discoveries,  and  every  extension  of  knowledge  of 
the  powers  of  nature  being  fruitful  of  applications  to  the  pur¬ 
poses  of  outward  life.  The  electro-magnetic  telegraph  was  the 
wonderful  and  most  unexpected  consequence  of  the  experi¬ 
ments  of  CErsted  and  the  mathematical  investigations  of  Am¬ 
pere  :  and  the  modern  art  of  navigation  is  an  unforeseen  emana¬ 
tion  from  the  purely  speculative  and  apparently  merely  curious 
inquiry,  by  the  mathematicians  of  Alexandria,  into  the  prop¬ 
erties  of  three  curves  formed  by  the  intersection  of  a  plane 
surface  and  a  cone.  No  limit  can  be  set  to  the  importance,  even 
in  a  purely  productive  and  material  point  of  view,  of  mere 
thought.  Inasmuch,  however,  as  these  material  fruits,  though 
the  results  are  seldom  the  direct  purpose  of  the  pursuits  of 
savants,  nor  is  their  remuneration  in  general  derived  from  the 
increased  production  which  may  be  caused  incidentally,  and 
mostly  after  a  long  interval,  by  their  discoveries ;  this  ulti¬ 
mate  influence  does  not,  for  most  of  the  purposes  of  political 
economy,  require  to  be  taken  into  consideration ;  and  specula¬ 
tive  thinkers  are  generally  classed  as  the  producers  only  of  the 
books,  or  other  usable  or  salable  articles,  which  directly  ema¬ 
nate  from  them.  But  when  (as  in  political  economy  one  should 
always  be  prepared  to  do)  we  shift  our  point  of  view,  and  con¬ 
sider  not  individual  acts,  and  the  motives  by  which  they  are 
determined,  but  national  and  universal  results,  intellectual 
speculation  must  be  looked  upon  as  a  most  influential  part  of 
the  productive  labor  of  society,  and  the  portion  of  its  resources 
employed  in  carrying  on  and  in  remunerating  such  labor,  as  a 
highly  productive  part  of  its  expenditure. 

§  9*  In  the  foregoing  survey  of  the  modes  of  employing 
labor  in  furtherance  of  production,  I  have  made  little  use  of  the 

popular  distinction  of  industry  into  agricultural,  manufactur¬ 

ing,  and  commercial.  For,  in  truth,  this  division  fulfils  very 


LABOR  AS  AN  AGENT  OF  PRODUCTION 


43 


badly  the  purposes  of  a  classification.  Many  great  branches  of 
productive  industry  find  no  place  m  it,  or  not  without  much 
straining ;  for  example  (not  to  speak  of  hunters  or  fishers)  the 
miner,  the  road-maker,  and  the.sailor.  The  limit,  too,  between 
agricultural  and  manufacturing  industry  cannot  be  precisely 
drawn.  The  miller,  for  instance,  and  the  baker — are  they  to  be 
reckoned  among  agriculturists,  or  among  manufacturers? 
Their  occupation  is  in  its  nature  manufacturing ;  the  food  has 
finally  parted  company  with  the  soil  before  it  is  handed  over 
to  them :  this,  however,  might  be  said  with  equal  truth  of  the 
thresher,  the  winnower,  the  makers  of  butter  and  cheese ; 
operations  always  counted  as  agricultural,  probably  because  it 
is  the  custom  for  them  to  be  performed  by  persons  resident  on 
the  farm,  and  under  the  same  superintendence  as  tillage.  For 
many  purposes,  all  these  persons,  the  miller  and  baker  inclu¬ 
sive,  must  be  placed  in  the  same  class  with  ploughmen  and 
reapers.  They  are  all  concerned  in  producing  food,  and  depend 
for  their  remuneration  on  the  food  produced :  when  the  one 
class  abounds  and  flourishes,  the  others  do  so  too ;  they  form 
collectively  the  “  agricultural  interest  ” ;  they  render  but  one 
service  to  the  community  by  their  united  labors,  and  are  paid 
from  one  common  source.  Even  the  tillers  of  the  soil,  again, 
when  the  produce  is  not  food,  but  the  materials  of  what  are 
commonly  termed  manufactures,  belong  in  many  respects  to 
the  same  division  in  the  economy  of  society  as  manufacturers. 
The  cotton-planter  of  Carolina,  and  the  wool-grower  of  Aus¬ 
tralia,  have  more  interests  in  common  with  the  spinner  and 
weaver  than  with  the  corn-grower.  But,  on  the  other  hand, 
the  industry  which  operates  immediately  upon  the  soil  has,  as 
we  shall  see  hereafter,  some  properties  on  which  many  impor¬ 
tant  consequences  depend,  and  which  distinguish  it  from  all  the 
subsequent  stages  of  production,  whether  carried  on  by  the 
same  person  or  not ;  from  the  industry  of  the  thresher  and 
winnower,  as  much  as  from  that  of  the  cotton-spinner.  When 
I  speak,  therefore,  of  agricultural  labor,  I  shall  generally  mean 
this,  and  this  exclusively,  unless  the  contrary  is  either  stated 
or  implied  in  the  context.  The  term  manufacturing  is  too 
vague  to  be  of  much  use  when  precision  is  required,  and  when 
I  employ  it,  I  wish  to  be  understood  as  intending  to  speak 
popularly  rather  than  scientifically. 


44 


POLITICAL  ECONOMY 


Chapter  III. — Of  Unproductive  Labor. 

§  i.  Labor  is  indispensable  to  production,  but  has  not  always 
production  for  its  effect.  There  is  much  labor,  and  of  a  high 
order  of  usefulness,  of  which  production  is  not  the  object. 
Labor  has  accordingly  been  distinguished  into  Productive  and 
Unproductive.  There  has  been  not  a  little  controversy  among 
political  economists  on  the  question,  what  kinds  of  labor  should 
be  reputed  to  be  unproductive ;  and  they  have  not  always  per¬ 
ceived  that  there  was  in  reality  no  matter  of  fact  in  dispute  be¬ 
tween  them. 

Many  writers  have  been  unwilling  to  class  any  labor  as  pro¬ 

ductive,  unless  its  result  is  palpable  in  some  material  object, 
capable  of  being  transferred  from  one  person  to  another.  There 
are  others  / among  whom  are  Mr.  MUulloch  and  M.  Sav_)  who 
looking  upon  the  word  un 

ment,  remonstrate  against 
js  regatded  as  useful — which  produces  a  benefit  or  a  pleasure 
worth  the  cost.  *rhe  labor  of  officers  of  government,  of  the 

army  and  navy,  of  physicians,  lawyers,  teachers,  musicians/ 

dancers,  actors,  domestic  servants,  etc.,  when  they  really  ac¬ 
complish  what  they  are  paid  for,  and  are  not  more  numerous 
than  is  required  for  its  performance,  ought  not,  say  these  writ¬ 

ers,  to  be  “  stigmatized  ”  as  unproductive,  an  expression  which 
they  appear  to  regard  as  synonymous  with  wasteful  or  worth¬ 
less.  But  this  seems  to  be  a  misunderstanding  of  the  matter 
in  dispute.  Production  not  being  the  sole  end  of  human  exist¬ 
ence,  the  term  unproductive  does  not  necessarily  imply  any 
stigma ;  nor  was  ever  intended  to  do  so  in  the  present  case. 

The  question  is  one  of  mere  language  and  classification.  Dif- 

/erences~of  language  however,  are  by  no  means  unimportantL 
even  when  not  grounded  on  differences  of  opinion;  for,  though 
either  of  two  expressions  may  be  consistent  with  the  whole 
truth,  they  generally  tend  to  fix  attention  upon  different  parts 
of  it.  We  must  therefore  enter  a  little  into  the  consideration 
of  the  various  meanings  which  may  attach  to  the  words  pro¬ 
ductive  and  unproductive  when  applied  to  labor. 

In  the  first  place,  even  in  what  is  called  the  production  of 
material  objects,  it  must  be  remembered  that  what  is  produced 
is  not  the  matter  composing  them.  All  the  labor  of  all  the 
human  beings  in  the  world  could  not  produce  one  particle  of 


productive  as  a  term  of  disparage- 

imposing  it  upon  any  labor  whicfi 


UNPRODUCTIVE  LABOR 


45 


matter.  To  weave  broadcloth  is  but  to  rearrange,  in  a  peculiar 
manner,  the  particles  of  wool;  to  grow  corn  is  only  to  put  a 
portion  of  matter  called  a  seed,  into  a  situation  where  it  can 
draw  together  particles  of  matter  from  the  earth  and  air,  to 
form  the  new  combination  called  a  plant.  Though  we  cannot 
create  matter,  we  can  cause  it  to  assume  properties,  by  which, 
from  having  been  useless  to  us,  it  becomes  useful.  What  we 
produce,  or  desire  to  produce,  is  always,  as  M.  Say  rightly 
terms  it,  a  utility.  Labor  is  not  creative  of  objects,  but  of 
utilities.  Neither,  again,  do  we  consume  and  destroy  the  ob¬ 
jects  themselves;  the  matter  of  which  they  were  composed  re¬ 
mains,  more  or  less  altered  in  form :  what  has  really  been  con¬ 
sumed  is  only  the  qualities  by  which  they  were  fitted  for  the 
purpose  they  have  been  applied  to.  It  is,  therefore,  pertinently 
asked  by  M.  Say  and  others — since,  when  we  are  said  to  pro¬ 
duce  objects,  we  only  produce  utility,  why  should  not  all  labor 
which  produces  utility  be  accounted  productive?  Why  refuse 
that  title  to  the  surgeon  who  sets  a  limb,  the  judge  or  legislator 
who  confers  security,  and  give  it  to  the  lapidary  who  cuts  and 
polishes  a  diamond?  Why  deny  it  to  the  teacher  from  whom 
I  learn  an  art  by  which  I  can  gain  my  bread,  and  accord  it  to 
the  confectioner  who  makes  bonbons  for  the  momentary  pleas¬ 
ure  of  a  sense  of  taste? 

It  is  quite  true  that  all  these  kinds  of  labor  are  productive 
of  utility;  and  the  question  which  now  occupies  us  could  not 
have  been  a  question  at  all,  if  the  production  of  utility  were 
enough  to  satisfy  the  notion  which  mankind  have  usually 
formed  of  productive  labor.  Production,  and  productive,  are, 
of  course,  elliptical  expressions,  involving  the  idea  of  a  some¬ 
thing  produced ;  but  this  something,  in  common  apprehension, 
I  conceive  to  be,  not  utility,  but  Wealth.  Productive  labor 
means  labor  productive  of  wealth.*  We  are  recalled,  therefore, 
to  the  question  touched  upon  in  our  first  chapter,  what  Wealth 
is,  and  whether  only  material  products,  or  all  useful  products. 
are  to  be  included  in  it. 

§  2.  Now,  the  utilities  produced  by  labor  are  of  three  kinds. 
They  are, 

First,  utilities  fixed  and  embodied  in  outward  objects;  by 
labor  employed  in  investing  external  material  things  with 
properties  which  render  them  serviceable  to  human  beings. 
This  is  the  common  case,  and  requires  no  illustration. 


46 


POLITICAL  ECONOMY 


Secondly,  utilities  fixed  and  embodied  in  human  beings ;  the 
labor  being  in  this  case  employed  in  conferring  on  human 
beings  qualities  which  render  them  serviceable  to  themselves 
and  others.  To  this  class  belongs  the  labor  of  all  concerned  in 
education ;  not  only  schoolmasters,  tutors,  and  professors,  but 
governments,  so  far  as  they  aim  successfully  at  the  improve¬ 
ment  of  the  people;  moralists,  and  clergymen,  as  far  as  pro¬ 
ductive  of  benefit;  the  labor  of  physicians,  as  far  as  instru¬ 
mental  in  preserving  life  and  physical  or  mental  efficiency ; 
of  the  teachers  of  bodily  exercises,  and  of  the  various  trades, 
sciences,  and  arts,  together  with  the  labor  of  the  learners  in 
acquiring  them  ;  and  all  labor  bestowed  by  any  persons,  through¬ 
out  life,  in  improving  the  knowledge  or  cultivating  the  bodily 
or  mental  faculties  of  themselves  or  others. 

Thirdly  and  lastly,  utilities  not  fixed  or  embodied  in  any 
object,  but  consisting  in  a  mere  service  rendered;  a  pleasure 
given,  an  inconvenience  or  a  pain  averted,  during  a  longer  or 
a  shorter  time,  but  without  leaving  a  permanent  acquisition  in 
the  improved  qualities  of  any  person  or  thing ;  the  labor  being 
employed  in  producing  a  utility  directly,  not  (as  in  the  two 
former  cases)  in  fitting  some  other  thing  to  afford  a  utility. 
Such,  for  example,  is  the  labor  of  the  musical  performer,  the 
actor,  the  public  declaimer  or  reciter,  and  the  showman.  Some 
good  may  no  doubt  be  produced,  and  much  more  might  be  pro¬ 
duced,  beyond  the  moment,  upon  the  feelings  and  disposition, 
or  general  state  of  enjoyment  of  the  spectators;  or  instead 
of  good  there  may  be  harm ;  but  neither  the  one  nor  the  other 
is  the  effect  intended,  is  the  result  for  which  the  exhibitor  works 
and  the  spectator  pays ;  nothing  but  the  immediate  pleasure. 
Such,  again,  is  the  labor  of  the  army  and  navy;  they,  at  the 
best,  prevent  a  country  from  being  conquered,  or  from  being 
injured  or  insulted,  which  is*a  service,  but  in  all  other  respects 
leave  the  country  neither  improved  nor  deteriorated.  Such, 
too,  is  the  labor  of  the  legislator,  the  judge,  the  officer  of  justice, 
and  all  other  agents  of  government,  in  their  ordinary  functions, 
apart  from  any  influence  they  may  exert  on  the  improvement 
of  the  national  mind.  The  service  which  they  render  is  to 
maintain  peace  and  security;  these  compose  the  utility  which 
they  produce.  It  may  appear  to  some  that  carriers  and  mer¬ 
chants  or  dealers  should  be  placed  in  this  same  class,  since 
their  labor  does  not  add  any  properties  to  objects:  but  I  reply 


UNPRODUCTIVE  LABOR 


47 


that  it  does;  it  adds  the  property  of  being  in  the  place  where 
they  are  wanted,  instead  of  being  in  some  other  place:  which 
is  a  very  useful  property,  and  the  utility  it  confers  is  embodied 
in  the  things  themselves,  which  now  actually  are  in  the  place 
where  they  are  required  for  use,  and  in  consequence  of  that 
increased  utility  could  be  sold  at  an  increased  price,  proportioned 
to  the  labor  expended  in  conferring  it.  This  labor,  therefore, 
does  not  belong  to  the  third  class,  but  to  the  first. 

§  3.  We  have  now  to  consider  which  of  these  three  classes 
of  labor  should  be  accounted  productive  of  wealth,  since  that 
is  what  the  term  productive,  when  used  by  itself,  must  be  un¬ 
derstood  to  import.  Utilities  of  the  third  class,  consisting  in 
pleasures  which  only  exist  while  being  enjoyed,  and  services 
which  only  exist  while  being  performed,  cannot  be  spoken  of 
as  wealth,  except  by  an  acknowledged  metaphor.  It  is  essen¬ 
tial  to  the  idea  of  wealth  to  be  susceptible  of  accumulation: 
things  which  cannot,  after  being  produced,  be  kept  for  some 
time  before  being  used,  are  never,  I  think,  regarded  as  wealth, 
since,  however  much  of  them  may  be  produced  and  enjoyed, 
the  person  benefited  by  them  is  no  richer,  is  nowise  improved 
in  circumstances.  But  there  is  not  so  distinct  and  positive  a 
violation  of  usage  in  considering  as  wealth  any  product  which 
is  both  useful  and  susceptible  of  accumulation.  The  skill,  and 
the  energy  and  perseverance,  of  the  artisans  of  a  country,  are 
reckoned  part  of  its  wealth,  no  less  than  their  tools  and  ma¬ 
chinery.*  According  to  this  definition,  we  should  regard  all 
labor  as  productive  which  is  employed  in  creating  permanent 
utilities,  whether  embodied  in  human  beings,  or  in  any  other 
animate  or  inanimate  objects.  This  nomenclature  I  have,  in 


*  Some  authorities  look  upon  it  as  an 
essential  element  in  the  idea  of  wealth, 
that  it  should  be  capable  not  solely  of 
being  accumulated,  but  of  being  trans¬ 
ferred;  and  inasmuch  as  the  valuable 
qualities,  and  even  the  productive  capac¬ 
ities,  of  a  human  being  cannot  be  de¬ 
tached  from  him  and  passed  to  some  one 
else,  they  deny  to  these  the  appellation 
of  wealth,  and  to  the  labor  expended  in 
acquiring  them  the  name  of  productive 
labor.  It  seems  to  me,  however,  that 
the  skill  of  an  artisan  (for  instance) 
being  both  a  desirable  possession  and 
one  of  a  certain  durability  (not  to  say 
productive  even  of  material  wealth), 
there  is  no  better  reason  for  refusing 
to  it  the  title  of  wealth  because  it  is 
attached  to  a  man,  than  to  a  coalpit  or 


a  manufactory  because  they  are  attached 
to  a  place.  Besides,  if  the  skill  itself 
cannot  be  parted  with  to  a  purchaser, 
the  use  of  it  may;  if  it  cannot  be  sold 
it  can  be  hired;  and  it  may  be,  and  is, 
sold  outright  in  all  countries  whose 
laws  permit  that  the  man  himself  should 
be  sold  along  with  it.  Its  defect  of 
transferability  does  not  result  from  a 
natural,  but  from  a  legal  and  moral 
obstacle. 

The  human  being  himself  (as  formerly 
observed)  I  do  not  class  as  wealth.  He 
is  the  purpose  for  which  wealth  exists. 
But  his  acquired  capacities,  which  exist 
only  as  means,  and  have  been  called 
into  existence  by  labor,  fall  rightly,  as 
it  seems  to  me,  within  that  designation. 


48 


POLITICAL  ECONOMY 


a  former  publication,*  recommended  as  the  most  conducive  to 
the  ends  of  classification;  and  I  am  still  of  that  opinion. 

But  in  applying  the  term  wealth  to  the  industrial  capacities 
of  human  beings,  there  seems  always,  in  popular  apprehension, 
to  be  a  tacit  reference  to  material  products.  The  skill  of  an 
artisan  is  accounted  wealth,  only  as  being  the  means  of  acquir¬ 
ing  wealth  in  a  material  sense ;  and  any  qualities  not  tending 
visibly  to  that  object  are  scarcely  so  regarded  at  all.  A  country 
would  hardly  be  said  to  be  richer,  except  by  a  metaphor,  how¬ 
ever  precious  a  possession  it  might  have  in  the  genius,  the 
virtues,  or  the  accomplishments  of  its  inhabitants ;  unless  in¬ 
deed  these  were  looked  upon  as  marketable  articles,  by  which 
it  could  attract  the  material  wealth  of  other  countries,  as  the 
Greeks  of  old,  and  several  modern  nations  have  done.  While, 
therefore,  I  should  prefer,  were  I  constructing  a  new  technical 
language,  to  make  the  distinction  turn  upon  the  permanence 
rather  than  upon  the  materiality  of  the  product,  yet  when  em¬ 
ploying  terms  which  common  usage  has  taken  complete  pos¬ 
session  of,  it  seems  advisable  so  to  employ  them  as  to  do  the 
least  possible  violence  to  usage ;  since  any  improvement  in  ter¬ 
minology  obtained  by  straining  the  received  meaning  of  a  pop¬ 
ular  phrase,  is  generally  purchased  beyond  its  value,  by  the 
obscurity  arising  from  the  conflict  between  new  and  old  asso¬ 
ciations. 

I  shall,  therefore,  in  this  treatise,  when  speaking  of  wealth, 
understand  by  it  only  what  is  called  material  wealth,  and  by 
productive  labor  only  those  kinds  of  exertion  which  produce 
qtilities  embodied  in  material  objects.  But  in  limiting  myself 
to  this  sense  of  the  word,  I  mean  to  avail  myself  of  the  full 
extent  of  that  restricted  acceptation,  and  I  shall  not  refuse  the 
appellation  productive,  to  labor  which  yields  no  material  prod¬ 
uct  as  its  direct  result,  provided  that  an  increase  of  material 
products  is  its  ultimate  consequence.  Thus,  labor  expended  in 
the  acquisition  of  manufacturing  skill  I  class  as  productive, 
not  in  virtue  of  the  skill  itself,  but  of  the  manufactured  products 
created  by  the  skill,  and  to  the  creation  of  which  the  labor  of 
learning  the  trade  is  essentially  conducive.  The  labor  of  officers 
of  government,  in  affording  the  protection  which,  afforded  in 
some  manner  or  other,  is  indispensable  to  the  prosperity  of  in- 

*  Essays  on  some  Unsettled  Questions  the  words  Productive  and  Unproduc- 
of  “  Political  Economy.”  Essay  III.  On  tive. 


UNPRODUCTIVE  LABOR 


49 


dustry,  must  be  classed  as  productive  even  of  material  wealth, 
because  without  it,  material  wealth,  in  anything  like  its  present 
abundance,  could  not  exist.  Such  labor  may  be  said  to  be  pro¬ 
ductive  indirectly  or  mediately,  in  opposition  to  the  labor  of  the 
ploughman  and  the  cotton-spinner,  which  are  productive  imme¬ 
diately.  They  are  all  alike  in  this,  that  they  leave  the  commu¬ 
nity  richer  in  material  products  than  they  found  it;  they  in¬ 
crease,  or  tend  to  increase,  material  wealth. 

§  4.  By  Unproductive  Labor,  on  the  contrary,  will  be  under¬ 
stood  labor  which  does  not  terminate  in  the  creation  of  material 
wealth ;  which,  however  largely  or  successfully  practised,  does 
pot  render  the  community  and  the  world  atlarge  richer  in  matq- 
pal  products,  hut  poorer  hy  all  thpt  is  consumed  by  the  laborers 
yhile  so  employed. 

All  labor  is,  in  the  language  of  political  economy,  unproduc¬ 
tive,  which  ends  in  immediate  enjoyment,  without  any  increase 
of  the  accumulated  stock  of  permanent  means  of  enjoyment. 
And  all  labor,  according  to  our  present  definition,  must  be 
classed  as  unproductive,  which  terminates  in  a  permanent  bene¬ 
fit,  however  important,  provided  that  an  increase  of  material 
products  forms  no  part  of  that  benefit.  The  labor  of  saving 
a  friend’s  life  is  not  productive,  unless  the  friend  is  a  productive 
laborer  and  produces  more  than  he  consumes.  To  a  religious 
person  the  saving  of  a  soul  must  appear  a  far  more  important 
service  than  the  saving  of  a  life ;  but  he  will  not  therefore  call 
a  missionary  or  a  clergyman  productive  laborers,  unless  they 
teach,  as  the  South  Sea  Missionaries  have  in  some  cases  done, 
the  arts  of  civilization  in  addition  to  the  doctrines  of  their  re¬ 
ligion.  It  is,  on  the  contrary,  evident  that  the  greater  number 
of  missionaries  or  clergymen  a  nation  maintains,  the  less  it  has 
to  expend  on  other  things;  while  the  more  it  expends  judi¬ 
ciously  in  keeping  agriculturists  and  manufacturers  at  work, 
the  more  it  will  have  for  every  other  purpose.  By  the  former 
it  diminishes,  cceteris  paribus,  its  stock  of  material  products ;  by 
the  latter,  it  increases  them. 

Unproductive  may  be  as  useful  as  productive  labor :  it  may 
be  more  useful,  even  in  point  of  permanent  advantage ;  or  its 
use  may  consist  only  in  pleasurable  sensation,  which,  when  gone, 
leaves  no  trace ;  or  it  may  not  afford  even  this,  but  may  be 
absolute  waste.  Jn  any  case  society  or  mankind  grow  no  richer 
by  it,  but  poorer.  All  material  products  consumed  by  anyone 
VoL.  I  — 4 


5° 


POLITICAL  ECONOMY 


while  he  produces  nothing  are  so  much  subtracted,  for  the  time, 
from  the  material  products  which  society  would  otherwise  have 
possessed.  But,  though  society  grows  no  richer  by  unproduc¬ 
tive  labor,  the  individual  may.  An  unproductive  laborer  may 
receive  for  his  labor,  from  those  who  derive  pleasure  or  benefit 
from  it,  a  remuneration  which  may  be  to  him  a  considerable 
source  of  wealth ;  but  his  gain  is  balanced  by  their  loss ;  they 
may  have  received  a  full  equivalent  for  their  expenditure,  but 
they  are  so  much  poorer  by  it.  When  a  tailor  makes  a  coat 
and  sells  it  there  is  a  transfer  of  the  price  from  the  customer 
to  the  tailor,  and  a  coat  besides  which  did  not  previously  exist ; 
but  what  is  gained  by  an  actor  is  a  mere  transfer  from  the  spec¬ 
tator’s  funds  to  his,  leaving  no  article  of  wealth  for  the  spec¬ 
tator’s  indemnification.  Thus  the  community  collectively  gains 
nothing  by  the  actor’s  labor;  and  it  loses,  of  his  receipts,  all 
that  portion  which  he  consumes,  retaining  only  that  which  he 
lays  by.  A  community,  however,  may  add  to  its  wealth  by 
unproductive  labor,  at  the  expense  of  other  communities,  as  an 
individual  may  at  the  expense  of  other  individuals.  The  gains 
of  Italian  opera  singers,  German  governesses,  French  ballet 
dancers,  etc.,  are  a  source  of  wealth,  as  far  as  they  go,  to  their 
respective  countries,  if  they  return  thither.  The  petty  states 
of  Greece,  especially  the  ruder  and  more  backward  of  those 
states,  were  nurseries  of  soldiers,  who  hired  themselves  to  the 
princes  and  satraps  of  the  East  to  carry  on  useless  and  destruc¬ 
tive  wars,  and  returned  with  their  savings  to  pass  their  declining 
years  in  their  own  country :  these  were  unproductive  laborers, 
and  the  pay  they  received,  together  with  the  plunder  they  took, 
was  an  outlay  without  return  to  the  countries  which  furnished 
it ;  but,  though  no  gain  to  the  world,  it  was  a  gain  to  Greece. 
At  a  later  period  the  same  country  and  its  colonies  supplied 
the  Roman  empire  with  another  class  of  adventurers,  who, 
under  the  name  of  philosophers  or  of  rhetoricians,  taught  to 
the  youth  of  the  higher  classes  what  were  esteemed  the  most 
valuable  accomplishments:  these  were  mainly  unproductive 
laborers,  but  their  ample  recompense  was  a  source  of  wealth 
to  their  own  country.  In  none  of  these  cases  was  there  any 
accession  of  wealth  to  the  world.  The  services  of  the  laborers,' 
if  useful,  were  obtained  at  a  sacrifice  to  the  world  of  a  portion 
of  material  wealth ;  if  useless,  all  that  these  laborers  consumed 
was,  to  the  world,  waste. 


UNPRODUCTIVE  LABOR 


5i 


To  be  wasted,  however,  is  a  liability  not  confined  to  unpro¬ 
ductive  labor.  Productive  labor  may  equally  be  wasted  if  more 
of  it  is  expended  than  really  conduces  to  production.  If  defect 
of  skill  in  laborers,  or  of  judgment  in  those  who  direct  them, 
causes  a  misapplication  of  productive  industry;  if  a  farmer 
persists  in  ploughing  with  three  horses  and  two  men,  when  ex¬ 
perience  has  shown  that  two  horses  and  one  man  are  sufficient, 
the  surplus  labor,  though  employed  for  purposes  of  production, 
is  wasted.  If  a  new  process  is  adopted  which  proves  no  better, 
or  not  so  good  as  those  before  in  use,  the  labor  expended  in 
perfecting  the  invention  and  in  carrying  it  into  practice,  though 
employed  for  a  productive  purpose,  is  wasted.  Productive  labor 
may  render  a  nation  poorer,  if  the  wealth  it  produces — that  is, 
the  increase  it  makes  in  the  stock  of  useful  or  agreeable  things — 
be  of  a  kind  not  immediately  wanted :  as  when  a  commodity 
is  unsalable,  because  produced  in  a  quantity  beyond  the  present 
demand;  or  when  speculators  build  docks  and  warehouses  be¬ 
fore  there  is  any  trade.  The  bankrupt  states  of  North  America, 
with  their  premature  railways  and  canals,  have  made  this  kind 
of  mistake;  and  it  was  for  some  time  doubtful  whether  Eng¬ 
land,  in  the  disproportionate  development  of  railway  enterprise, 
had  not,  in  some  degree,  followed  the  example.  Labor  sunk  in 
expectation  of  a  distant  return,  when  the  great  exigencies  or 
limited  resources  of  the  community  require  that  the  return  be 
rapid,  may  leave  the  country  not  only  poorer  in  the  meanwhile, 
by  all  which  those  laborers  consume,  but  less  rich  even  ulti¬ 
mately  than  if  immediate  returns  had  been  sought  in  the  first 
instance,  and  enterprises  for  distant  profit  postponed. 

§  5.  The  distinction  of  Productive  and  Unproductive  is  ap¬ 
plicable  to  consumption  as  well  as  to  labor.  All  the  members 
of  the  community  are  not  laborers,  but  all  are  consumers,  and 
consume  either  unproductively  or  productively.  Whoever  con¬ 
tributes  nothing  directly  or  indirectly  to  production,  is  an  un¬ 
productive  consumer.  The  only  productive  consumers  are  pro¬ 
ductive  laborers,  the  labor  of  direction  being  of  course  included, 
as  well  as  that  of  execution.  But  the  consumption  even  of  pro¬ 
ductive  laborers  is  not  all  of  it  productive  consumption.  There 
is  unproductive  consumption  by  productive  consumers.  What 
they  consume  in  keeping  up  or  improving  their  health,  strength, 
and  capacities  of  work,  or  in  rearing  other  productive  laborers  to 
succeed  them,  is  productive  consumption.  But  consumption  on 


52 


POLITICAL  ECONOMY 


pleasures  or  luxuries,  whether  by  the  idle  or  by  the  industrious, 
since  production  is  neither  its  object  nor  is  in  any  way  advanced 
by  it,  must  be  reckoned  unproductive :  with  a  reservation,  per¬ 
haps,  of  a  certain  quantum  of  enjoyment  which  may  be  classed 
among  necessaries,  since  anything  short  of  it  would  not  be 
consistent  with  the  greatest  efficiency  of  labor.  That  alone  is 
productive  consumption  which  goes  to  maintain  and  increase 
the  productive  powers  of  the  community ;  either  those  residing 
in  its  soil,  in  its  materials,  in  the  number  and  efficiency  of  its 
instruments  of  production,  or  in  its  people. 

There  are  numerous  products  which  may  be  said  not  to 
admit  of  being  consumed  otherwise  than  unproductively.  The 
annual  consumption  of  gold  lace,  pineapples,  or  champagne 
must  be  reckoned  unproductive,  since  these  things  give  no  as¬ 
sistance  to  production,  nor  any  support  to  life  or  strength,  but 
what  would  equally  be  given  by  things  much  less  costly.  Hence 
it  might  be  supposed  that  the  labor  employed  in  producing  them 
ought  not  to  be  regarded  as  productive  in  the  sense  in  which 
the  term  is  understood  by  political  economists.  I  grant  that 
no  labor  tends  to  the  permanent  enrichment  of  society  which  is 
employed  in  producing  things  for  the  use  of  unproductive  con¬ 
sumers.  The  tailor  who  makes  a  coat  for  a  man  who  produces 
nothing  is  a  productive  laborer ;  but  in  a  few  weeks  or  months 
the  coat  is  worn  out,  while  the  wearer  has  not  produced  any¬ 
thing  to  replace  it,  and  the  community  is  then  no  richer  by  the 
labor  of  the  tailor  than  if  the  same  sum  had  been  paid  for  a 
stall  at  the  opera.  Nevertheless,  society  has  been  richer  by 
the  labor  while  the  coat  lasted — that  is,  until  society,  through 
one  of  its  unproductive  members,  chose  to  consume  the  produce 
of  the  labor  unproductively.  The  case  of  the  gold  lace  or  the 
pineapple  is  no  further  different  than  that  they  are  still  further 
removed  than  the  coat  from  the  character  of  necessaries.  These 
things  also  are  wealth  until  they  have  been  consumed. 

§  6.  We  see,  however,  by  this  that  there  is  a  distinction,  more 
important  to  the  wealth  of  a  community  than  even  that  between 
productive  and  unproductive  labor — the  distinction,  namely,  be¬ 
tween  labor  for  the  supply  of  productive,  and  for  the  supply  of 
unproductive  consumption ;  between  labor  employed  in  keeping 
up  or  in  adding  to  the  productive  resources  of  the  country,  and 
that  which  is  employed  otherwise.  Of  the  produce  of  the  coun¬ 
try,  a  part  only  is  destined  to  be  consumed  productively ;  the 


UNPRODUCTIVE  LABOR 


53 


remainder  supplies  the  unproductive  consumption  of  producers 
and  the  entire  consumption  of  the  unproductive  classes.  Sup¬ 
pose  that  the  proportion  of  the  annual  produce  applied  to  the 
first  purpose  amounts  to  half;  then  one-half  the  productive 
laborers  of  the  country  are  all  that  are  employed  in  the  opera¬ 
tions  on  which  the  permanent  wealth  of  the  country  depends. 
The  other  half  are  occupied  from  year  to  year,  and  from  gen¬ 
eration  to  generation,  in  producing  things  which  are  consumed 
and  disappear  without  return ;  and  whatever  this  half  consume 
is  as  completely  lost,  as  to  any  permanent  effect  on  the  national 
resources,  as  if  it  were  consumed  unproductively.  Suppose  that 
this  second  half  of  the  laboring  population  ceased  to  work,  and 
that  the  government  or  their  parishes  maintained  them  in  idle¬ 
ness  for  a  whole  year:  the  first  half  would  suffice  to  produce, 
as  they  had  done  before,  their  own  necessaries  and  the  neces¬ 
saries  of  the  second  half,  and  to  keep  the  stock  of  materials  and 
implements  undiminished ;  the  unproductive  classes,  indeed, 
would  be  either  starved  or  obliged  to  produce  their  own  sub¬ 
sistence,  and  the  whole  community  would  be  reduced  during 
a  year  to  bare  necessaries  ;  but  the  sources  of  production  would 
be  unimpaired,  and  the  next  year  there  would  not  necessarily 
be  a  smaller  produce  than  if  no  such  interval  of  inactivity  had 
occurred ;  while,  if  the  case  had  been  reversed,  if  the  first  half 
of  the  laborers  had  suspended  their  accustomed  occupations, 
and  the  second  half  had  continued  theirs,  the  country  at  the 
end  of  the  twelvemonth  would  have  been  entirely  impoverished. 

It  would  be  a  great  error  to  regret  the  large  proportion  of 
the  annual  produce  which,  in  an  opulent  country,  goes  to  sup¬ 
ply  unproductive  consumption.  It  would  be  to  lament  that  the 
community  has  so  much  to  spare  from  its  necessities  for  its 
pleasures  and  for  all  higher  uses.  This  portion  of  the  produce 
is  the  fund  from  which  all  the  wants  of  the  community,  other 
than  that  of  mere  living,  are  provided  for — the  measure  of  its 
means  of  enjoyment  and  of  its  power  of  accomplishing  all  pur¬ 
poses  not  productive.  That  so  great  a  surplus  should  be  avail¬ 
able  for  such  purposes,  and  that  it  should  be  applied  to  them, 
can  only  be  a  subject  of  congratulation.  The  things  to  be  re¬ 
gretted,  and  which  are  not  incapable  of  being  remedied,  are 
the  prodigious  inequality  with  which  this  surplus  is  distrib¬ 
uted,  the  little  worth  of  the  objects  to  which  the  greater  part 
of  it  is  devoted,  and  the  large  share  which  falls  to  the  lot  of 
persons  who  render  no  equivalent  service  in  return. 


54 


POLITICAL  ECONOMY 


Chapter  IV. — Of  Capital 

§  i.  It  has  been  seen  in  the  preceding  chapters  that,  besides 
the  primary  and  universal  requisites  of  production,  labor  and 
natural  agents,  there  is  another  requisite  without  which  no 
productive  operations  beyond  the  rude  and  scanty  beginnings 
of  primitive  industry  are  possible,  namely,  a  stock,  previously 
accumulated,  of  the  products  of  former  labor.  This  accumu¬ 
lated  stock  of  the  produce  of  labor  is  termed  Capital.  The 
function'oFCapTfalTrTproduction  it  is  of  the  utmost  importance 
thoroughly  to  understand,  since  a  number  of  the  erroneous 
notions  with  which  our  subject  is  infested  originate  in  an  im¬ 
perfect  and  confused  apprehension  of  this  point. 

Capital,  by  persons  wholly  unused  to  reflect  on  the  subject,  is 
supposed  to  be  synonymous  with  money.  To  expose  this  mis¬ 
apprehension  would  be  to  repeat  what  has  been  said  in  the 
introductory  chapter.  Money  is  no  mpjrejsynonymous  with  cap¬ 
ital  than  jt_is  with  wealth.  Money  cannot  itself  perform  any 
part  of  the  office  of  capital,  since  it  can  afford  no  assistance  to 
production.  To  do  this  it  must  be  exchanged  for  other  things ; 
and  anything  which  is  susceptible  of  being  exchanged  for  other 
things  is  capable  of  contributing  to  production  in  the  same  de¬ 
gree.  What  capital  does  for  production,  is  to  afford  the  shelter, 
protection,  tools,  and  materials  which  the  work  requires,  and 

to  feed  and  otherwise  maintain  the  laborers  during  the  process. 

These  are  the  services  which  present  labor  requires  from  past, 

and  from  the  produce  of  past,  labor.  Whatever  things  are 

destined  for  this  use — destined  to  supply  productive  labor  with 
these  various  prerequisites: — are  Capital. 

To  familiarize  ourselves  with  the  conception,  let  us  consider 
what  is  done  with  the  capital  invested  in  any  of  the  branches 
of  business  which  compose  the  productive  industry  of  a  country. 
A  manufacturer,  for  example,  has  one  part  of  his  capital  in 
the  form  of  buildings  fitted  and  destined  for  carrying  on  his 
branch  of  manufacture.  Another  part  he  has  in  the  form  of 
machinery.  A  third  consists,  if  he  be  a  spinner,  of  raw  cotton, 
flax,  or  wool ;  if  a  weaver,  of  flaxen,  woollen,  silk,  or  cotton 
thread ;  and  the  like,  according  to  the  nature  of  the  manufact¬ 
ure.  Food  and  clothing  for  his  operatives  it  is  not  the  custom 
of  the  present  age  that  he  should  directly  provide;  and  few 
capitalists,  except  the  producers  of  food  or  clothing,  have  any 


CAPITAL 


55 


portion  worth  mentioning  of  their  capital  in  that  shape.  In¬ 
stead  of  this,  each  capitalist  has  money,  which  he  pays  to  his 
work-people,  and  so  enables  them  to  supply  themselves :  he  has 
also  finished  goods  in  his  warehouses,  by  the  sale  of  which  he 
obtains  more  money,  to  employ  in  the  same  manner,  as  well 
as  to  replenish  his  stock  of  materials,  to  keep  his  buildings  and 
machinery  in  repair,  and  to  replace  them  when  worn  out.  His 
money  and  finished  goods,  however,  are  not  wholly  capital,  for 
he  does  not  wholly  devote  them  to  these  purposes :  he  employs 
a  part  of  the  one,  and  of  the  proceeds  of  the  other,  in  supplying 
his  personal  consumption  and  that  of  his  family,  or  in  hiring 
grooms  and  valets,  or  maintaining  hunters  and  hounds,  or  in 
educating  his  children,  or  in  paying  taxes,  or  in  charity.  What 
then  is  his  capital  ?  Precisely  that  part  of  his  possessions,  what¬ 
ever  it  be,  which  is  to  constitute  his  fund  for  carrying  on  fresh 
production.  It  is  of  no  consequence  that  a  part,  or  even  the 
whole  of  it,  is  in  a  form  in  which  it  cannot  directly  supply  the 
wants  of  laborers. 

Suppose,  for  instance,  that  the  capitalist  is  a  hardware  man¬ 
ufacturer,  and  that  his  stock  in  trade,  over  and  above  his  ma¬ 
chinery,  consists  at  present  wholly  in  iron  goods.  Iron  goods 
cannot  feed  laborers.  Nevertheless,  by  a  mere  change  of  the 
destination  of  these  iron  goods,  he  can  cause  laborers  to  be  fed. 
Suppose  that  with  a  portion  of  the  proceeds  he  intended  to 
maintain  a  pack  of  hounds,  or  an  establishment  of  servants ; 
and  that  he  changes  his  intention,  and  employs  it  in  his  busi¬ 
ness,  paying  it  in  wages  to  additional  work-people.  These 
work-people  are  enabled  to  buy  and  consume  the  food  which 
would  otherwise  have  been  consumed  by  the  hounds  or  by  the 
servants;  and  thus  without  the  employer’s  having  seen  or 
touched  one  particle  of  the  food,  his  conduct  has  determined 
that  so  much  more  of  the  food  existing  in  the  country  has  been 
devoted  to  the  use  of  productive  laborers,  and  so  much  less 
consumed  in  a  manner  wholly  unproductive.  Now  vary  the 
hypothesis,  and  suppose  that  what  is  thus  paid  in  wages  would 
otherwise  have  been  laid  out  not  in  feeding  servants  or  hounds, 
but  in  buying  plate  and  jewels,  and  in  order  to  render  the  effect 
perceptible,  let  us  suppose  that  the  change  takes  place  on  a 
considerable  scale,  and  that  a  large  sum  is  diverted  from  buying 
plate  and  jewels  to  employing  productive  laborers,  whom  we 
shall  suppose  to  have  been  previously,  like  the  Irish  peasantry, 


56 


POLITICAL  ECONOMY 


only  half  employed  and  half  fed.  The  laborers,  on  receiving 
their  increased  wages,  will  not  lay  them  out  in  plate  and  jewels, 
but  in  food.  There  is  not,  however,  additional  food  in  the 
country;  nor  any  unproductive  laborers  or  animals,  as  in  the 
former  case,  whose  food  is  set  free  for  productive  purposes. 
Food  will  therefore  be  imported  if  possible;  if  not  possible, 
the  laborers  will  remain  for  a  season  on  their  short  allowance : 
but  the  consequence  of  this  change  in  the  demand  for  com¬ 
modities,  occasioned  by  the  change  in  the  expenditure  of  the 
capitalists  from  unproductive  to  productive,  is  that  next  year 
more  food  will  be  produced,  and  less  plate  and  jewelry.  So 
that  again,  without  having  had  anything  to  do  with  the  food 
of  the  laborers  directly,  the  conversion  by  individuals  of  a  por¬ 
tion  of  their  property,  no  matter  of  what  sort,  from  an  unpro¬ 
ductive  destination  to  a  productive,  has  had  the  effect  of  causing 
more  food  to  be  appropriated  to  the  consumption  of  productive 
laborers.  The  distinction,  then,  between  Capital  and  Not-capi- 
tal,  does  not  lie  in  the  kind  of  commodities,  but  in  the  mind 
of  the  capitalist — in  his  will  to  employ  them  for  one  purpose 
rather  than  another;  and  all  property,  however  ill  adapted  in 
itself  for  the  use  of  laborers,  is  a  part  of  capital,  so  soon  as  it, 
or  the  value  to  be  received  from  it,  is  set  apart  for  productive 
reinvestment.  The  sum  of  all  the  values  so  destined  by  their 
respective  possessors,  composes  the  capital  of  the  country. 
Whether  all  those  values  are  in  a  shape  directly  applicable  to 
productive  uses,  makes  no  difference.  Their  shape,  whatever 
it  may  be,  is  a  temporary  accident ;  but,  once  destined  for  pro¬ 
duction,  they  do  not  fail  to  find  a  way  of  transforming  them¬ 
selves  into  things  capable  of  being  applied  to  it. 

§  2.  As  whatever  of  the  produce  of  the  country  is  devoted 
to  production  is  capital,  so,  conversely,  the  whole  of  the  capital 
of  the  country  is  devoted  to  production.  This  second  proposi¬ 
tion,  however,  must  be  taken  with  some  limitations  and  explana¬ 
tions.  A  fund  may  be  seeking  for  productive  employment,  and 
find  none,  adapted  to  the  inclinations  of  its  possessor:  it  then  is 
capital  still,  but  unemployed  capital.  Or  the  stock  may  consist 
of  unsold  goods,  not  susceptible  of  direct  application  to  produc¬ 
tive  uses,  and  not,  at  the  moment,  marketable :  these,  until  sold, 
are  in  the  condition  of  unemployed  capital.  Again,  artificial  or 
accidental  circumstances  may  render  it  necessary  to  possess  a 
larger  stock  in  advance,  that  is,  a  larger  capital  before  entering 


CAPITAL 


57 


on  production,  than  is  required  by  the  nature  of  things.  Sup- 
post  that  the  government  lays  a  tax  on  the  production  in  one 
of  its  earlier  stages,  as  for  instance  by  taxing  the  material.  The 
manufacturer  has  to  advance  the  tax,  before  commencing  the 
manufacture,  and  is  therefore  under  a  necessity  of  having  a 
larger  accumulated  fund  than  is  required  for,  or  is  actually  em¬ 
ployed  in,  the  production  which  he  carries  on.  He  must  have 
a  larger  capital,  to  maintain  the  same  quantity  of  productive 
labor;  or  (what  is  equivalent)  with  a  given  capital  he  main¬ 
tains  less  labor.  This  mode  of  levying  taxes,  therefore,  limits 
unnecessarily  the  industry  of  the  country :  a  portion  of  the  fund 
destined  by  its  owners  for  production  being  diverted  from  its 
purpose,  and  kept  in  a  constant  state  of  advance  to  the  govern¬ 
ment. 

For  another  example :  a  farmer  may  enter  on  his  farm  at  such 
a  time  of  the  year,  that  he  may  be  required  to  pay  one,  two, 
or  even  three  quarters’  rent  before  obtaining  any  return  from 
the  produce.  This,  therefore,  must  be  paid  out  of  his  capital. 
Now  rent,  when  paid  for  the  land  itself,  and  not  for  improve¬ 
ments  made  in  it  by  labor,  is  not  a  productive  expenditure. 
It  is  not  an  outlay  for  the  support  of  labor,  or  for  the  provision 
of  implements  or  materials  the  produce  of  labor.  It  is  the  price 
paid  for  the  use  of  an  appropriated  natural  agent.  This  natural 
agent  is  indeed  as  indispensable  (and  even  more  so)  as  any 
implement :  but  the  having  to  pay  a  price  for  it,  is  not.  In  the 
case  of  the  implement  (a  thing  produced  by  labor)  a  price  of 
some  sort  is  the  necessary  condition  of  its  existence:  but  the 
land  exists  by  nature.  The  payment  for  it,  therefore,  is  not 
one  of  the  expenses  of  production  ;  and  the  necessity  of  making 
the  payment  out  of  capital,  makes  it  requisite  that  there  should 
be  a  greater  capital,  a  greater  antecedent  accumulation  of  the 
produce  of  past  labor,  than  is  naturally  necessary,  or  than  is 
needed  where  land  is  occupied  on  a  different  system.  This 
extra  capital,  though  intended  by  its  owners  for  production, 
is  in  reality  employed  unproductively,  and  annually  replaced, 
not  from  any  produce  of  its  own,  but  from  the  produce  of  the 
labor  supported  by  the  remainder  of  the  farmer’s  capital. 

Finally,  that  large  portion  of  the  productive  capital  of  a  coun¬ 
try  which  is  employed  in  paying  the  wages  and  salaries  of  labor¬ 
ers,  evidently  is  not,  all  of  it,  strictly  and  indispensably  necessary 
for  production.  As  much  of  it  as  exceeds  the  actual  necessaries 


POLITICAL  ECONOMY 


58 

of  life  and  health  (an  excess  which  in  the  case  of  skilled  la¬ 
borers  is  usually  considerable)  is  not  expended  in  supporting 
labor,  but  in  remunerating  it,  and  the  laborers  could  wait  for 
this  part  of  their  remuneration  until  the  production  is  com¬ 
pleted  :  it  needs  not  necessarily  pre-exist  as  capital :  and  if 
they  unfortunately  had  to  forego  it  altogether,  the  same  amount 
of  production  might  take  place.  In  order  that  the  whole  re¬ 
muneration  of  the  laborers  should  be  advanced  to  them  in  daily 
or  weekly  payments,  there  must  exist  in  advance,  and  be  appro¬ 
priated  to  productive  use,  a  greater  stock,  or  capital,  than  would 
suffice  to  carry  on  the  existing  extent  of  production :  greater,  by 
whatever  amount  of  remuneration  the  laborers  receive,  beyond 
what  the  self-interest  of  a  prudent  slave-master  would  assign 
to  his  slaves.  In  truth,  it  is  only  after  an  abundant  capital  had 
already  been  accumulated,  that  the  practice  of  paying  in  ad¬ 
vance  any  remuneration  of  labor  beyond  a  bare  subsistence, 
could  possibly  have  arisen :  since  whatever  is  so  paid,  is  not 
really  applied  to  production,  but  to  the  unproductive  consump¬ 
tion  of  productive  laborers,  indicating  a  fund  for  production 
sufficiently  ample  to  admit  of  habitually  diverting  a  part  of  it 
to  a  mere  convenience. 

It  will  be  observed  that  I  have  assumed,  that  the  laborers  are 
always  subsisted  from  capital :  and  this  is  obviously  the  fact, 
though  the  capital  needs  not  necessarily  be  furnished  by  a 
person  called  a  capitalist.  When  the  laborer  maintains  himself 
by  funds  of  his  own,  as  when  a  peasant-farmer  or  proprietor 
lives  on  the  produce  of  his  land,  or  an  artisan  works  on  his 
own  account,  they  are  still  supported  by  capital,  that  is,  by  funds 
provided  in  advance.  The  peasant  does  not  subsist  this  year 
on  the  produce  of  this  year’s  harvest,  but  on  that  of  the  last. 
The  artisan  is  not  living  on  the  proceeds  of  the  work  he  has 
in  hand,  but  on  those  of  work  previously  executed  and  dis¬ 
posed  of.  Each  is  supported  by  a  small  capital  of  his  own, 
which  he  periodically  replaces  from  the  produce  of  his  labor. 
The  large  capitalist  is,  in  like  manner,  maintained  from  funds 
provided  in  advance.  If  he  personally  conducts  his  operations, 
as  much  of  his  personal  or  household  expenditure  as  does 
not  exceed  a  fair  remuneration  of  his  labor  at  the  market  price, 
must  be  considered  a  part  of  his  capital,  expended,  like  any 
other  capital,  for  production:  and  his  personal  consumption, 
so  far  as  it  consists  of  necessaries,  is  productive  consumption. 


CAPITAL 


59 


§  3.  At  the  risk  of  being  tedious,  I  must  add  a  few  more 
illustrations,  to  bring  out  into  a  still  clearer  and  stronger  light 
the  idea  of  Capital.  As  M.  Say  truly  remarks,  it  is  on  the  very 
elements  of  our  subject  that  illustration  is  most  usefully  be¬ 
stowed,  since  the  greatest  errors  which  prevail  in  it  may  be 
traced  to  the  want  of  a  thorough  mastery  over  the  elementary 
ideas.  Nor  is  this  surprising:  a  branch  may  be  diseased  and 
all  the  rest  healthy,  but  unsoundness  at  the  root  diffuses  un¬ 
healthiness  through  the  whole  tree. 

Let  us  therefore  consider  whether,  and  in  what  cases,  the 
property  of  those  who  live  on  the  interest  of  what  they  possess, 
without  being  personally  engaged  in  production,  can  be  re¬ 
garded  as  capital.  It  is  so  called  in  common  language,  and, 
with  reference  to  the  individual,  not  improperly.  All  funds 
from  which  the  possessor  derives  an  income,  which  income  he 
can  use  without  sinking  and  dissipating  the  fund  itself,  are  to 
him  equivalent  to  capital.  But  to  transfer  hastily  and  incon¬ 
siderately  to  the  general  point  of  view,  propositions  which 
are  true  of  the  individual,  has  been  a  source  of  innumerable 
errors  in  political  economy.  In  the  present  instance,  that  which 
is  virtually  capital  to  the  individual,  is  or  is  not  capital  to  the 
nation,  according  as  the  fund  which  by  the  supposition  he  has 
not  dissipated,  has  or  has  not  been  dissipated  by  somebody  else. 

For  example,  let  property  of  the  value  of  ten  thousand 
pounds  belonging  to  A,  be  lent  to  B,  a  farmer  or  manufacturer, 
and  employed  profitably  in  B’s  occupation.  It  is  as  much  cap¬ 
ital  as  if  it  belonged  to  B.  A  is  really  a  farmer  or  manufacturer, 
not  personally,  but  in  respect  of  his  property.  Capital  worth 
ten  thousand  pounds  is  employed  in  production — in  maintaining 
laborers  and  providing  tools  and  materials ;  which  capital  be¬ 
longs  to  A,  while  B  takes  the  trouble  of  employing  it,  and  re¬ 
ceives  for  his  remuneration  the  difference  between  the  profit 
which  it  yields  and  the  interest  he  pays  to  A.  This  is  the 
simplest  case. 

Suppose  next  that  A’s  ten  thousand  pounds,  instead  of  being 
lent  to  B,  are  lent  on  mortgage  to  C,  a  landed  proprietor,  by 
whom  they  are  employed  in  improving  the  productive  powers 
of  his  estate,  by  fencing,  draining,  road-making,  or  permanent 
manures.  This  is  productive  employment.  The  ten  thousand 
pounds  are  sunk,  but  not  dissipated.  They  yield  a  permanent 
return ;  the  land  now  affords  an  increase  of  produce,  sufficient,, 


6o 


POLITICAL  ECONOMY 


in  a  few  years,  if  the  outlay  has  been  judicious,  to  replace  the 
amount,  and  in  time  to  multiply  it  manifold.  Here,  then,  is 
a  value  of  ten  thousand  pounds,  employed  in  increasing  the 
produce  of  the  country.  This  constitutes  a  capital,  for  which 
C,  if  he  lets  his  land,  receives  the  returns  in  the  nominal  form 

f 

of  increased  rent ;  and  the  mortgage  entitles  A  to  receive  from 
these  returns,  in  the  shape  of  interest,  such  annual  sum  as  has 
been  agreed  on.  We  will  now  vary  the  circumstances,  and 
suppose  that  C  does  not  employ  the  loan  in  improving  his  land, 
but  in  paying  off  a  former  mortgage,  or  in  making  a  provision 
for  children.  Whether  the  ten  thousand  pounds  thus  employed 
are  capital  or  not,  will  depend  on  what  is  done  with  the  amount 
by  the  ultimate  receiver.  If  the  children  invest  their  fortunes 
in  a  productive  employment,  or  the  mortgagee  on  being  paid 
off  lends  the  amount  to  another  landholder  to  improve  his  land, 
or  to  a  manufacturer  to  extend  his  business,  it  is  still  capital, 
because  productively  employed. 

Suppose,  however,  that  C,  the  borrowing  landlord,  is  a  spend¬ 
thrift,  who  burdens  his  land  not  to  increase  his  fortune  but 
to  squander  it,  expending  the  amount  in  equipages  and  enter¬ 
tainments.  In  a  year  or  two  it  is  dissipated,  and  without  return. 
A  is  as  rich  as  before ;  he  has  no  longer  his  ten  thousand  pounds, 
but  he  has  a  lien  on  the  land,  which  he  could  still  sell  for  that 
amount.  C,  however,  is  ten  thousand  pounds  poorer  than  former¬ 
ly  ;  and  nobody  is  richer.  It  may  be  said  that  those  are  richer  who 
have  made  profit  out  of  the  money  while  it  was  being  spent.  No 
doubt  if  C  lost  it  by  gaming,  or  was  cheated  of  it  by  his  ser¬ 
vants,  that  is  a  mere  transfer,  not  a  destruction,  and  those  who 
have  gained  the  amount  may  employ  it  productively.  But  if  C 
has  received  the  fair  value  for  his  expenditure  in  articles  of 
subsistence  or  luxury,  which  he  has  consumed  on  himself,  or 
by  means  of  his  servants  or  guests,  these  articles  have  ceased 
to  exist,  and  nothing  has  been  produced  to  replace  them :  while 
if  the  same  sum  had  been  employed  in  farming  or  manufactur¬ 
ing,  the  consumption  which  would  have  taken  place  would 
have  been  more  than  balanced  at  the  end  of  the  year  by  new 
products,  created  by  the  labor  of  those  who  would  in  that  case 
have  been  the  consumers.  By  C’s  prodigality,  that  which  would 
have  been  consumed  with  a  return,  is  consumed  without  return. 
C’s  tradesmen  may  have  made  a  profit  during  the  process ;  but 
if  the  capital  had  been  expended  productively,  an  equivalent 


CAPITAL 


61 

profit  would  have  been  made  by  builders,  fencers,  toolmakers, 
and  the  tradespeople  who  supply  the  consumption  of  the  labor¬ 
ing  classes ;  while  at  the  expiration  of  the  time  (to  say  nothing 
of  any  increase),  C  would  have  had  the  ten  thousand  pounds 
or  its  value  replaced  to  him,  which  now  he  has  not.  There  is, 
therefore,  on  the  general  result,  a  difference  to  the  disadvantage 
of  the  community,  of  at  least  ten  thousand  pounds,  being  the 
amount  of  C’s  unproductive  expenditure.  To  A,  the  difference 
is  not  material,  since  his  income  is  secured  to  him,  and  while 
the  security  is  good,  and  the  market  rate  of  interest  the  same, 
he  can  always  sell  the  mortgage  at  its  original  value.  To 
A,  therefore,  the  lien  of  ten  thousand  pounds  on  C’s  estate, 
is  virtually  a  capital  of  that  amount ;  but  is  it  so  in  reference 
to  the  community  ?  It  is  not.  A  had  a  capital  of  ten  thousand 
pounds,  but  this  has  been  extinguished — dissipated  and  de¬ 
stroyed  by  C’s  prodigality.  A  now  receives  his  income,  not 
from  the  produce  of  his  capital,  but  from  some  other  source  of 
income  belonging  to  C,  probably  from  the  rent  of  his  land, 
that  is,  from  payments  made  to  him  by  farmers  out  of  the 
produce  of  their  capital.  The  national  capital  is  diminished  by 
ten  thousand  pounds,  and  the  national  income  by  all  which 
those  ten  thousand  pounds,  employed  as  capital,  would  have 
produced.  The  loss  does  not  fall  on  the  owner  of  the  destroyed’ 
capital,  since  the  destroyer  has  agreed  to  indemnify  him  for  it. 
But  his  loss  is  only  a  small  portion  of  that  sustained  by  the 
community,  since  what  was  devoted  to  the  use  and  consump¬ 
tion  of  the  proprietor  was  only  the  interest ;  the  capital  itself 
was,  or  would  have  been,  employed  in  the  perpetual  mainten¬ 
ance  of  an  equivalent  number  of  laborers,  regularly  reproduc¬ 
ing  what  they  consumed:  and  of  this  maintenance  they  are 
deprived  without  compensation. 

Let  us  now  vary  the  hypothesis  still  further,  and  suppose 
that  the  money  is  borrowed,  not  by  a  landlord,  but  by  the  State. 
A  lends  his  capital  to  Government  to  carry  on  a  war :  he  buys 
from  the  State  what  are  called  government  securities ;  that  is, 
obligations  on  the  government  to  pay  a  certain  annual  income. 
If  the  government  employed  the  money  in  making  a  railroad, 
this  might  be  a  productive  employment,  and  A’s  property  would 
still  be  used  as  capital ;  but  since  it  is  employed  in  war,  that  is, 
in  the  pay  of  officers  and  soldiers  who  produce  nothing,  and  in 
destroying  a  quantity  of  gunpowder  and  bullets  without  return, 


6  2 


POLITICAL  ECONOMY 


the  government  is  in  the  situation  of  C,  the  spendthrift  land¬ 
lord,  and  A’s  ten  thousand  pounds  are  so  much  national  capital 
which  once  existed,  but  exists  no  longer :  virtually  thrown  into 
the  sea,  as  far  as  wealth  or  production  is  concerned;  though 
for  other  reasons  the  employment  of  it  may  have  been  justi¬ 
fiable.  A’s  subsequent  income  is  derived,  not  from  the  produce 
of  his  own  capital,  but  from  taxes  drawn  from  the  produce  of 
the  remaining  capital  of  the  community;  to  whom  his  capital 
is  not  yielding  any  return,  to  indemnify  them  for  the  payment ; 
it  is  lost  and  gone,  and  what  he  now  possesses  is  a  claim  on  the 
returns  to  other  people’s  capital  and  industry.  This  claim  he 
can  sell,  and  get  back  the  equivalent  of  his  capital,  which  he 
may  afterward  employ  productively.  True;  but  he  does  not 
get  back  his  own  capital,  or  anything  which  it  has  produced ; 
that,  and  all  its  possible  returns,  are  extinguished :  what  he 
gets  is  the  capital  of  some  other  person,  which  that  person  is 
willing  to  exchange  for  his  lien  on  the  taxes.  Another  capitalist 
substitutes  himself  for  A  as  a  mortgagee  of  the  public,  and  A 
substitutes  himself  for  the  other  capitalist  as  the  possessor  of 
a  fund  employed  in  production,  or  available  for  it.  By  this 
exchange  the  productive  powers  of  the  community  are  neither 
increased  nor  diminished.  The  breach  in  the  capital  of  the 
country  was  made  when  the  government  spent  A’s  money: 
whereby  a  value  of  ten  thousand  pounds  was  withdrawn  or 
withheld  from  productive  employment,  placed  in  the  fund  for 
unproductive  consumption,  and  destroyed  without  equivalent. 

Chapter  V. — Fundamental  Propositions  Respecting  Capital 

§  i.  If  the  preceding  explanations  have  answered  their  pur¬ 
pose,  they  have  given  not  only  a  sufficiently  complete  possession 
of  the  idea  of  Capital  according  to  its  definition,  but  a  sufficient 
familiarity  with  it  in  the  concrete,  and  amidst  the  obscurity  with 
which  the  complication  of  individual  circumstances  surrounds 
it,  to  have  prepared  even  the  unpractised  reader  for  certain  ele¬ 
mentary  propositions  or  theorems  respecting  capital,  the  full 
comprehension  of  which  is  already  a  considerable  step  out  of 
darkness  into  light. 

The  first  of  these  propositions  is,  That  industry  is  limited  by 
capital.  This  is  so  obvious  as  to  be  taken  for  granted  in  many 
common  forms  of  speech;  but  to  see  a  truth  occasionally  is  one 


FUNDAMENTAL  PROPOSITIONS  ON  CAPITAL  63 


thing,  to  recognize  it  habitually,  and  admit  no  propositions  in¬ 
consistent  with  it,  is  another.  The  axiom  was  until  lately  almost 
universally  disregarded  by  legislators  and  political  writers;  and 
doctrines  irreconcilable  with  it  are  still  very  commonly  professed 
and  inculcated. 

The  following  are  common  expressions,  implying  its  truth. 
The  act  of  directing  industry  to  a  particular  employment  is  de¬ 
scribed  by  the  phrase  “applying  capital  ”  to  the  employment. 
To  employ  industry  on  the  land  is  to  apply  capital  to  the  land. 
To  employ  labor  in  a  manufacture  is  to  invest  capital  in  the 
manufacture.  This  implies  that  industry  cannot  be  employed  to 
any  greater  extent  than  there  is  capital  to  invest.  The  proposi¬ 
tion,  indeed,  must  be  assented  to  as  soon  as  it  is  distinctly  ap¬ 
prehended.  The  expression  “  applying  capital  ”  is  of  course 
metaphorical:  what  is  really  applied  is  labor;  capital  being  an 
indispensable  condition.  Again,  we  often  speak  of  the  “  produc¬ 
tive  powers  of  capital.’’  This  expression  is  not  literally  correct. 
The  only  productive  powers  are  those  of  labor  and  natural 
agents;  or  if  any  portion  of  capital  can  by  a  stretch  of  language 
be  said  to  have  a  productive  power  of  its  own,  it  is  only 
tools  and  machinery,  which,  like  wind  or  water,  may  be  said  to 
co-operate  with  labor.  The  food  of  laborers  and  the  materials 
of  production  have  no  productive  power;  but  labor  cannot  exert 
it  productive  power  unless  provided  with  them.  There  can  be 
no  more  industry  than  is  supplied  with  materials  to  work  up  and 
food  to  eat.  Self-evident  as  the  thing  is,  it  is  often  forgotten  that 
the  people  of  a  country  are  maintained  and  have  their  wants  sup¬ 
plied,  not  by  the  produce  of  present  labor,  but  of  past.  They 
consume  what  has  been  produced,  not  what  is  about  to  be  pro¬ 
duced.  Now,  of  what  has  been  produced,  a  part  only  is  allotted 
to  the  support  of  productive  labor;  and  there  will  not  and 
cannot  be  more  of  that  labor  than  the  portion  so  allotted  (which 
is  the  capital  of  the  country)  can  feed,  and  provide  with  the  ma¬ 
terials  and  instruments  of  production. 

Yet,  in  disregard  of  a  fact  so  evident,  it  long  continued  to  be 
believed  that  laws  and  governments,  without  creating  capital, 
could  create  industry.  Not  by  making  the  people  more  labo¬ 
rious,  or  increasing  the  efficiency  of  their  labor;  these  are  ob¬ 
jects  to  which  the  government  can,  in  some  degree,  indirectly 
contribute.  But  without  any  increase  in  the  skill  or  energy  of 
the  laborers,  and  without  causing  any  persons  to  labor  who  had 


64 


POLITICAL  ECONOMY 


previously  been  maintained  in  idleness,  it  was  still  thought  that 
the  government,  without  providing  additional  funds,  could  cre¬ 
ate  additional  employment.  A  government  would,  by  prohibi¬ 
tory  laws,  put  a  stop  to  the  importation  of  some  commodity: 
and  when  bv  this  it  had  caused  the  commodity  to  be  produced 
at  home,  it  would  plume  itself  upon  having  enriched  the  country 
with  a  new  branch  ot  industry,  would  parade  in  statistical  tables 
the  amount  of  produce  yielded  and  labor  employed  in  the  pro¬ 
duction.  and  take  credit  tor  the  whole  of  this  as  a  gain  to  the 
country,  obtained  through  the  prohibitory  law.  Although  this 
sort  of  political  arithmetic  has  fallen  a  little  into  discredit  in 
England,  it  still  flourishes  in  the  nations  of  Continental  Europe. 
Had  legislators  been  aware  that  industry  is  limited  by  capital, 
tliev  would  have  seen  that,  the  aggregate  capital  of  the  country 
not  having  been  increased,  any  portion  of  it  which  they  bv  their 
laws  had  caused  to  be  embarked  in  the  newly-acquired  branch 
of  industry  must  have  been  withdrawn  or  withheld  from  some 
other;  in  which  it  gave,  or  would  have  given,  employment  to 
probably  about  the  same  quantity  of  labor  which  it  employs  in  its 
new  occupation.* 

§  2-  Because  industry  is  limited  by  capital,  we  are  not  how- 
ever  to  infer  that  it  always  reaches  that  limit.  Capital  may  be 
temporarily  unemployedTas  in  the  case  of  unsold  goods,  or  funds 
that  have  not  yet  found  an  investment;  during  this  interval  it 
does  not  set  in  motion  any  industry.  Or  there  may  not  be  as 
many  laborers  obtainable,  as  the  capital  would  maintain  and  em¬ 
ploy.  This  has  been  known  to  occur  in  new  colonies,  where 
capital  has  sometimes  perished  uselessly  for  want  of  labor:  the 
Swan  River  settlement  (now  called  Western  Australia),  in  the 
first  years  after  its  foundation,  was  an  instance.  There  are  many 


*  An  exception  must  be  admitted  when 
the  industry  created  or  upheld  by  the 
restrictive  law  belongs  to  the  class  of 
what  are  called  domestic  manufactures. 
These  being  carried  on  by  persons  al¬ 
ready  fed — by  laboring  families,  in  the 
intervals  of  other  employment — no  trans¬ 
fer  of  capital  to  the  occupation  is  neces¬ 
sary  to  its  being  undertaken,  beyond 
the  value  of  the  materials  and  tools, 
which  is  often  inconsiderable.  If,  there¬ 
fore,  a  protecting  duty  causes  this  occu¬ 
pation  to  be  carried  on,  when  it  other¬ 
wise  would  not,  there  is  in  this  case  a 
real  increase  of  the  production  of  the 
country. 

In  order  to  render  our  theoretical 
proposition  invulnerable,  this  peculiar 
case  must  be  allowed  for:  but  it  does 


not  touch  the  practical  doctrine  of  free 
trade.  Domestic  manufactures  cannot, 
from  the  very  nature  of  things,  require 
protection,  since  the  subsistence  of  the 
laborers  being  provided  from  other 
sources,  the  price  of  the  product,  how¬ 
ever  much  it  may  be  reduced,  is  nearly 
all  clear  gain.  If,  therefore,  the  do¬ 
mestic  producers  retire  from  the  com¬ 
petition,  it  is  never  from  necessity,  but 
because  the  product  is  not  worth  the 
labor  it  costs,  in  the  opinion  of  the  best 
judges,  those  who  enjoy  the  one  and  un¬ 
dergo  the  other.  They  prefer  the  sac¬ 
rifice  of  buying  their  clothing  to  the 
labor  of  making  it.  They  will  not  con¬ 
tinue  their  labor  unless  society  will 
give  them  more  for  it,  than  in  their  own 
opinion  its  product  is  worth. 


FUNDAMENTAL  PROPOSITIONS  ON  CAPITAL  65 


persons  maintained  from  existing  capital,  who  produce  nothing, 
or  who  might  produce  much  more  than  they  do.  If  the  laborers 
were  reduced  to  lower  wages,  or  induced  to  work  more  hours 
for  the  same  wages,  or  if  their  families,  who  are  already  main¬ 
tained  from  capital,  were  employed  to  a  greater  extent  than  they 
now  are  in  adding  to  the  produce,  a  given  capital  would  afford 
employment  to  more  industry.  The  unproductive  consumption 
of  productive  laborers,  the  whole  of  which  is  now  supplied  by 
capital,  might  cease,  or  be  postponed  until  the  produce  came  in; 
and  additional  productive  laborers  might  be  maintained  with  the 
amount.  By  such  means  society  might  obtain  from  its  existing 
resources  a  greater  quantity  of  produce:  and  to  such  means  it 

■* 

has  been  driven,  when  the  sudden  destruction  of  some  large 
portion  of  its  capital  rendered  the  employment  of  the  remainder., 
with  the  greatest  possible  effect,  a  matter  of  paramount  consider¬ 
ation  for  the  time. 

Where  industry  has  not  come  up  to  the  limit  imposed  by  capi¬ 
tal,  governments  may,  in  various  ways,  for  example,  by  import¬ 
ing  additional  laborers,  bring  it  nearer  to  that  limit:  as  by  the 
importation  of  Coolies  and  free  Negroes  into  the  West  Indies. 
There  is  another  way  in  which  governments  can  create  additional 
industry.  They  can  create  capital.  They  may  lay  on  taxes,  and 
employ  the  amount  productively.  They  may  do  what  is  nearly 
equivalent;  they  may  lay  taxes  on  income  or  expenditure,  and 
apply  the  proceeds  towards  paying  off  the  public  debts.  The 
fundholder,  when  paid  off,  would  still  desire  to  draw  an  income 
from  his  property,  most  of  which  therefore  would  find  its  way 
into  productive  employment,  while  a  great  part  of  it  would  have 
been  drawn  from  the  fund  for  unproductive  expenditure,  since 
people  do  not  wholly  pay  their  taxes  from  what  they  would  have 
saved,  but  partly,  if  not  chiefly,  from  what  they  would  have  spent. 
It  may  be  added,  that  any  increase  in  the  productive  power  of 
capital  (or,  more  properly  speaking,  of  labor)  by  improvements 
in  the  arts  of  life,  or  otherwise,  tends  to  increase  the  employment 
for  labor;  since,  when  there  is  a  greater  produce  altogether,  it  is 
always  probable  that  some  portion  of  the  increase  will  be  saved 
and  converted  into  capital;  especially  when  the  increased  re¬ 
turns  to  productive  industry  hold  out  an  additional  temptation 
to  the  conversion  of  funds  from  an  unproductive  destination  to  a 
productive. 

§  3.  While,  on  the  one  hand,  industry  is  limited  by  capital,  so 

Vol.  I. — 5 


66 


POLITICAL  ECONOMY 


on  the  other,  every  increase  of  capital  gives,  or  is  capable  of  giv¬ 
ing,  additional  employment  to  industry;  and  this  without  as¬ 
signable  limit.  I  do  not  mean  to  deny  that  the  capital,  or  part  of 
it,  may  be  so  employed  as  not  to  support  laborers,  being  fixed  in 
machinery,  buildings,  improvement  of  land,  and  the  like.  In 
any  large  increase  of  capital  a  considerable  portion  will  gen¬ 
erally  be  thus  employed,  and  will  only  co-operate  with  laborers, 
not  maintain  them.  What  I  do  intend  to  assert  is,  that  the  por¬ 
tion  which  is  destined  to  their  maintenance,  may  (supposing  no 
alteration  in  anything  else)  be  indefinitely  increased,  without  cre¬ 
ating  an  impossibility  of  finding  them  employment:  in  other 
words,  that  if  there  are  human  beings  capable  of  work,  and  food 
to  feed  them,  they  may  always  be" employe'd"lrrpro?ucing  some¬ 
thing.  This  proposition  requires  to  be  somewhat  dwelt  upon, 
being  one  of  those  which  it  is  exceedingly  easy  to  assent  to  when 
presented  in  general  terms,  but  somewhat  difficult  to  keep  fast 
hold  of,  in  the  crowd  and  confusion  of  the  actual  facts  of  society. 
It  is  also  very  much  opposed  to  common  doctrines.  There  is 
not  an  opinion  more  general  among  mankind  than  this,  that  the 
unproductive  expenditure  of  the  rich  is  necessary  to  the  employ¬ 
ment  of  the  poor.  Before  A_dam  Smith,  the  doctrine  had  hardly 
been  questioned;  and  even  since  his  time,  authors  of  the  highest 
name  and  of  great  merit  *  have  contended,  that  if  consumers 
were  to  save  and  convert  into  capital  more  than  a  limited  por¬ 
tion  of  their  income,  and  were  not  to  devote  to  unproductive 
consumption  an  amount  of  means  bearing  a  certain  ratio  to  the 
capital  of  the  country,  the  extra  accumulation  would  be  merely 
so  much  waste,  since  there  would  be  no  market  for  the  commodi¬ 
ties  which  the  capital  so  created  would  produce.  I  conceive  this 
to  be  one  of  the  many  errors  arising  in  political  economy,  from 
the  practice  of  not  beginning  with  the  examination  of  simple 
cases,  but  rushing  at  once  into  the  complexity  of  concrete  phe¬ 
nomena. 

Everyone  can  see  that  if  a  benevolent  government  possessed 
all  the  food,  and  all  the  implements  and  materials,  of  the  com¬ 
munity,  it  could  exact  productive  labor  from  all  capable  of  it, 
to  whom  it  allowed  a  share  in  the  food,  and  could  be  in  no  danger 
of  wanting  a  field  for  the  employment  of  this  productive  labor, 
since  as  long  as  there  was  a  single  want  unsaturated  (which  ma¬ 
terial  objects  could  supply),  of  any  one  individual,  the  labor  of 

*  For  example,  Mr.  Malthus,  Dr.  Chalmers,  M.  de  Sismondi. 


FUNDAMENTAL  PROPOSITIONS  ON  CAPITAL  67 


the  community  could  be  turned  to  the  production  of  something 
capable  of  satisfying  that  want.  Now,  the  individual  possessors 
of  capital,  when  they  add  to  it  by  fresh  accumulations,  are  doing 
precisely  the  same  thing  which  we  suppose  to  be  done  by  a 
benevolent  government.  As  it  is  allowable  to  put  any  case  by 
way  of  hypothesis,  let  us  imagine  the  most  extreme  case  con¬ 
ceivable.  Suppose  that  every  capitalist  came  to  be  of  opinion 
that  not  being  more  meritorious  than  a  well-conducted  laborer, 
lie  ougnE  nor  to  fare  better;  and  accordingly  laid  by,  from  con¬ 
scientious  motives,  the  surplus  of  his  profits ;  or  suppose  this . 
abstinence  not  spontaneous,  but  Imposed  by  law  or  opinion  upojp 
all  capitalists,  and  upon  landowners  likewise.  Unproductive 
expenditure  is  now  reduced  to  its  lowest  limit:  and  it  is  asked, 
how  is  the  increased  capital  to  find  employment?  Who  is  to  buy 
the  goods  which  it  will  produce?  There  are  no  longer  customers 
even  for  those  which  were  produced  before.  The  goods,  there¬ 
fore,  (it  is  said)  will  remain  unsold;  they  will  perish  in  the  ware¬ 
houses;  until  capital  is  brought  down  to  what  it  was  originally, 
or  rather  to  as  much  less,  as  the  demand  of  the  consumers  has 
lessened.  But  this  is  seeing  only  one-half  of  the  matter.  In  the 
case  supposed,  there  would  no  longer  be  any  demand  for  luxu¬ 
ries,  on  the  part  of  capitalists  and  landowners.  But  when  these 
classes  turn  their  income  into  capital,  they  do  not  thereby  anni¬ 
hilate  their  power  of  consumption;  they  do  but  transfer  it  from 
themselves  to  the  laborers  to  whom  they  give  employment. 
Now,  there  are  two  possible  suppositions  in  regard  to  the  labor¬ 
ers;  either  there  is,  or  there  is  not,  an  increase  of  their  numbers, 
proportional  to  the  increase  of  capital.  If  there  is,  the  case  offers 
no  difficulty.  The  production  of  necessaries  for  the  new  popula¬ 
tion,  takes  the  place  of  the  production  of  luxuries  for  a  portion 
of  the  old,  and  supplies  exactly  the  amount  of  employment  which 
has  been  lost.  But  suppose  that  there  is  no  increase  of  popula¬ 
tion.  The  whole  of  what  was  previously  expended  in  luxuries, 
by  capitalists  and  landlords,  is  distributed  among  the  existing 
laborers,  in  the  form  of  additional  wages.  We  will  assume  them 
to  be  already  sufficiently  supplied  with  necessaries.  What  fol¬ 
lows?  That  the  laborers  become  consumers  of  luxuries;  and 
the  capital  previously  employed  in  the  production  of  luxuries,  is 
still  able  to  employ  itself  in  the  same  manner:  the  difference  be¬ 
ing,  that  the  luxuries  are  shared  among  the  community  generally, 
instead  of  being  confined  to  a  few.  The  increased  accumulation 


•V* 


68 


POLITICAL  ECONOMY 


>  * 


*  • 


*  •  «  .» 


and  increased  production  might,  rigorously  speaking,  continue, 
until  every  laborer  had  every  indulgence  of  wealth,  consistent 
with  continuing  to  work;  supposing  that  the  power  of  their 
labor  were  physically  sufficient  to  produce  all  this  amount  of  in¬ 
dulgences  for  their  whole  number.  Thus  the  limit  of  wealth  is 
never  deficiency  of  consumers,  but  of  producers  and  productive 
power.  Every  addition  to  capital  gives  to  labor  either  additional 
employment,  or  additional  remuneration;  enriches  either  the 

country,  or  the  laboring  class,  if  it  finds" additional  hands  to  set 

tcTwork,  it  increasesThe  aggregate  produce:  iFEnlyThe  same 

hands,  it  gives  them  a  larger  share  of  it ;  and  perhaps  even  in  this 

case,  by  stimulating  them  to  greater  exertion,  augments  the 

produce  itself. 

§  4.  A  second  fundamental  theorem  respecting  Capital,  re¬ 
lates  to  the  source  from  which  it  is  derived.  It  is  the  result  of 
saving.  The" evidence  of  this  lies  abundantly  in  what  has  been 
already  said  on  the  subject.  But  the  proposition  needs  some 
further  illustration. 

If  all  persons  were  to  expend  in  personal  indulgences  all  that 
they  produce,  and  all  the  income  they  receive  from  what  is  pro¬ 
duced  by  others,  capital  could  not  increase.  All  capital,  with  a 
trifling  exception,  was  originally  the  rosult  of  saving.  I  say,  with 
a  trifling  exception;  because  a  person  who  labors  on  his  own 
account,  may  spend  on  his  own  account  all  he  produces,  with¬ 
out  becoming  destitute;  and  the  provision  of  necessaries  on 
which  he  subsists  until  he  has  reaped  his  harvest,  or  sold  his 
commodity,  though  a  real  capital,  cannot  be  said  to  have  been 
saved,  since  it  is  all  used  for  the  supply  of  his  own  wants,  and 
perhaps  as  speedily  as  if  it  had  been  consumed  in  idleness.  We 
may  imagine  a  number  of  individuals  or  families  settled  on  as 
many  separate  pieces  of  land,  each  living  on  what  their  own 
labor  produces,  and  consuming  the  whole  produce.  But  even 
these  must  save  (that  is,  spare  from  their  personal  consumption) 
as  much  as  is  necessary  for  seed.  Some  saving,  therefore,  there 
must  have  been,  even  in  this  simplest  of  all  states  of  economical 
relations;  people  must  have  produced  more  than  they  used,  or 
used  less  than  they  produced.  Still  more  must  they  do  so  before 
they  can  employ  other  laborers,  or  increase  their  production  be¬ 
yond  what  can  be  accomplished  by  the  work  of  their  own  hands. 
All  that  anyone  employs  in  supporting  and  carrying  on  any  other 
labor  than  his  own,  must  have  been  originally  brought  together 


FUNDAMENTAL  PROPOSITIONS  ON  CAPITAL  69 


by  saving;  somebody  must  have  produced  it  and  forborne  to 
consume  it.  We  may  say,  therefore,  without  material  inaccuracy, 
that  all  capital,  and  especially  all  addition  to  capital,  are  the  re¬ 
sult  of  saving. 

In  a  rude  and  violent  state  of  society  it  continually  happens 
that  the  person  who  has  capital  is  not  the  very  person  who  has 
saved  it,  but  some  one  who,  being  stronger,  or  belonging  to  a 
more  powerful  community,  has  possessed  himself  of  it  by 
plunder.  And  even  in  a  state  of  things  in  which  property  was 
protected,  the  increase  of  capital  has  usually  been,  for  a  long 
time,  mainly  derived  from  privations  which,  though  essentially 
the  same  with  saving,  are  not  generally  called  by  that  name,  be¬ 
cause  not  voluntary.  The  actual  producers  have  been  slaves, 
compelled  to  produce  as  much  as  force  could  extort  from  them, 
and  to  consume  as  little  as  the  self-interest  or  the  usually  very 
slender  humanity  of  their  taskmasters  would  permit.  This  kind 
of  compulsory  saving,  however,  would  not  have  caused  any  in¬ 
crease  of  capital,  unless  a  part  of  the  amount  had  been  saved 
over  again,  voluntarily,  by  the  master.  If  all  that  he  made  his 
slaves  produce  and  forbear  to  consume,  had  been  consumed  by 
him  on  personal  indulgences,  he  would  not  have  increased  his 
capital,  nor  been  enabled  to  maintain  an  increasing  number  of 
slaves.  To  maintain  any  slaves  at  all,  implied  a  previous  saving ; 
a  stock,  at  least  of  food,  provided  in  advance.  This  saving  may 
not,  however,  have  been  made  by  any  self-imposed  privation  of 
the  master;  but  more  probably  by  that  of  the  slaves  themselves 
while  free;  the  rapine  or  war,  which  deprived  them  of  their  per¬ 
sonal  liberty,  having  transferred  also  their  accumulations  to  the 
conqueror. 

There  are  other  cases  in  which  the  term  saving,  with  the  asso¬ 
ciations  usually  belonging  to  it,  does  not  exactly  fit  the  opera¬ 
tion  by  which  capital  is  increased.  If  it  were  said,  for  instance, 
that  the  only  way  to  accelerate  the  increase  of  capital  is  by  in¬ 
crease  of  saving,  the  idea  would  probably  be  suggested  of  greater 
abstinence,  and  increased  privation.  But  it  is  obvious  that  what¬ 
ever  increases  the  productive  power  of  labor,  creates  an  addition¬ 
al  fund  to  make  savings  from,  and  enables  capital  to  be  enlarged 
not  only  without  additional  privation,  but  concurrently  with  a.n 
increase  of  personal  consumption.  NeverthelessT  there  is  here 
an  increase  of  saving,  in  the  scientific  sense.  Though  there  is 
more  consumed,  there  is  also  more  spared!  There  is  a  greater 


7o 


POLITICAL  ECONOMY 


excess  of  production  over  consumption.  It  is  consistent  with 
correctness  to  call  this  a  greater  saving.  Though  the  term  is  not 
unobjectionable,  there  is  no  other  which  is  not  liable  to  as  great 
objections.  To  consume  less  than  is  produced,  is  saving;  and 
that  is  the  process  by  which  capital  is  increased;  not  necessarily 
by  consuming  less,  absolutely.  We  must  not  allow  ourselves  to 
be  so  much  the  slaves  of  words,  as  to  be  unable  to  use  the  word 
saving  in  this  sense,  without  being  in  danger  of  forgetting  that 
to  increase  capital  there  is  another  way  besides  consuming  less, 
namely,  to  produce  more. 

§  5.  A  third  fundamental  theorem  respecting  Capital,  closely 
connected  with  the  one  last  discussed  is.  that  although  saved, 
and,  the  result  of  saving,  it  is  nevertheless  consumed.  Tlie 
word  saving  does  not  imply  that  what  is  saved  is  not  consumed, 
nor  even  necessarily  that  its  consumption  is  deferred;  but  only 
that,  if  consumed  immediately,  it  is  not  consumed  by  the  person 
>vho  saves  it.  .If  merely  laid  by  for  future  use,  it  is  said  to  Te 
hoarded ;  and  while  hoarded,  is  not  consumed  at  all._  But  if  em¬ 
ployed  as  capital,  it  is  all  consumed ;  though  not  by  the  capitalist. 
Part  is  exchanged  for  tools  or  machinery,  which  are  worn  out  by 
use:  part  for  seed  or  materials,  which  are  destroyed  as  such  by 
being  sown  or  wrought  up,  and  destroyed  altogether  by  the  con¬ 
sumption  of  the  ultimate  product.  The  remainder  is  paid  in 
wages  to  productive  laborers,  who  consume  it  for  their  daily 
wants;  orif  they  in  their  turn  save  any  part,  this  also  is  not,  gen¬ 
erally  speaking,  hoarded,  but  (through  savings  banks,  benefit 
clubs,  or  some  other  channel)  re-employed  as  capital,  and  con¬ 
sumed. 

The  principle  now  stated  is  a  strong  example  of  the  necessity 
of  attention  to  the  most  elementary  truths  of  our  subject:  for  it 
is  one  of  the  most  elementary  of  them  all,  and  yet  no  one  who 
has  not  bestowed  some  thought  on  the  matter  is  habitually  aware 
of  it,  and  most  are  not  even  willing  to  admit  it  when  first  stated. 
To  the  vulgar,  it  is  not  at  all  apparent  that  what  is  saved  is  con¬ 
sumed.  To  them,  everyone  who  saves,  appears  in  the  light  of  a 
person  who  hoards;  they  may  think  such  conduct  permissible, 
or  even  laudable,  when  it  is  to  provide  for  a  family,  and  the  like; 
but  they  have  no  conception  of  it  as  doing  good  to  other  people: 
saving  is  to  them  another  word  for  keeping  a  thing  to  one’s  self; 
while  spending  appears  to  them  to  be  distributing  it  among 
others.  The  person  who  expends  his  fortune  in  unproductive 


FUNDAMENTAL  PROPOSITIONS  ON  CAPITAL  71 


consumption,  is  looked  upon  as  diffusing  benefits  all  around; 
and  is  an  object  of  so  much  favor,  that  some  portion  of  the  same 
popularity  attaches  even  to  him  who  spends  what  does  not  belong 
to  him;  who  not  only  destroys  his  own  capital,  if  he  ever  had 
any,  but,  under  pretence  of  borrowing,  and  on  promise  of  repay¬ 
ment,  possesses  himself  of  capital  belonging  to  others,  and  de¬ 
stroys  that  likewise. 

This  popular  error  comes  from  attending  to  a  small  portion 
only  of"  the  consequences  that  flow  from  the  saving  or  the 
spending;  all  the  effects  of  either  which  are  out  of  sight,  be¬ 
ing  out  of  mind.  The  eye  follows  what  is  saved,  into  an  imag¬ 
inary  strong  box,  and  there  loses  sight  of  Jt;  what  is  spent, 
it  follows  into  the  hands  of  tradespeople  an3~ dependents;  5uT 
without  reaching  the  ultimate  desthiatinri ^TT’TTthpr  nsp' 
Saving  (for  productive  investment),  and  spending,  coincide 
very  closely  in  the  first  stage  of  their  operations.  The  effects 
of  both  begin  with  consumption;  with  the  destruction  of  a 
certain  portion  of  wealth;  only  the  things  consumed,  and 
the  persons  consuming,  are  different.  There  is,  in  the  one 
case,  a  wearing  out  of  tools,  a  destruction  of  material,  and  a 
quantity  of  food  and  clothing  supplied  to  laborers,  which 
they  destroy  by  use;  in  the  other  case,  there  is  a  consumption, 
that  is  to  say,  a  destruction,  of  wines,  equipages,  and  furniture. 
Thus  far,  the  consequence  to  the  national  wealth  has  been  much 
the  same;  an  equivalent  quantity  of  it  has  been  destroyed  in 
both  cases.  But  in  the  spending,  this  first  stage  is  also  the  final 
stage;  that  particular  amount  of  the  produce  of  labor  has  dis¬ 
appeared,  and  there  is  nothing  left;  while,  on  the  contrary,  the 
saving  person,  during  the  whole  time  that  the  destruction  was 
going  on,  has  had  laborers  at  work  repairing  it;  who  are  ulti¬ 
mately  found  to  have  replaced,  with  an  increase,  the  equivalent 
of  what  has  been  consumed.  And  as  this  operation  admits  of 
being  repeated  indefinitely  without  any  fresh  act  of  saving,  a  sav¬ 
ing  once  made  becomes  a  fund  to  maintain  a  corresponding 
number  of  laborers  in  perpetuity,  reproducing  annually  their 
own  maintenance  with  a  profit. 

It  is  the  intervention  of  money  which  obscures,  to  an  unprac¬ 
tised  apprehension,  the  true  character  of  these  phenomena.  Al¬ 
most  all  expenditure  being  carried  on  by  means  of  money,  the 
money  comes  to  be  looked  upon  as  the  main  feature  in  the  trans¬ 
action;  and  since  that  does  not  perish,  but  only  changes  hands, 


72 


POLITICAL  ECONOMY 


people  overlook  the  destruction  which  takes  place  in  the  case  of 
unproductive  expenditure.  The  money  being  merely  transferred, 
they  think  the  wealth  also  has  only  been  handed  over  from  the 
spendthrift  to  other  people.  But  this  is  simply  confounding 
money  with  wealth.  The  wealth  which  has  been  destroyed  was 
not  the  money,  but  the  wines,  equipages,  and  furniture  which 
the  money  purchased;  and  these  having  been  destroyed  without 
return,  society  collectively  is  poorer  by  the  amount.  It  may  be 
said,  perhaps,  that  wines,  equipages,  and  furniture,  are  not  sub¬ 
sistence,  tools,  and  materials,  and  could  not  in  any  case  have 
been  applied  to  the  support  of  labor;  that  they  are  adapted  for 
no  other  than  unproductive  consumption,  and  that  the  detriment 
to  the  wealth  of  the  community  was  when  they  were  produced, 
not  when  they  were  consumed.  I  am  willing  to  allow  this,  as 
far  as  is  necessary  for  the  argument,  and  the  remark  would  be 
very  pertinent  if  these  expensive  luxuries  were  drawn  from  an 
existing  stock,  never  to  be  replenished.  But  since,  on  the  con¬ 
trary,  they  continue  to  be  produced  as  long  as  there  are  con¬ 
sumers  for  them,  and  are  produced  in  increased  quantity  to  meet 
an  increased  demand;  the  choice  made  by  a  consumer  to  expend 
five  thousand  a  year  in  luxuries,  keeps  a  corresponding  number 
of  laborers  employed  from  year  to  year  in  producing  things 
which  can  be  of  no  use  to  production;  their  services  being  lost 
so  far  as  regards  the  increase  of  the  national  wealth,  and  the  tools, 
materials,  and  food  which  they  annually  consume  being  so  much 
subtracted  from  the  general  stock  of  the  community  applicable 
to  productive  purposes.  In  proportion  as  any  class  is  improvi¬ 
dent  or  luxurious,  the  industry  of  the  country  takes  the  direction 
of  producing  luxuries  for  their  use ;  while  not  only  the  employ¬ 
ment  for  productive  laborers  is  diminished,  but  the  subsistence 
and  instruments  which  are  the  means  of  such  employment  do 
actually  exist  in  smaller  quantity. 
paving,  in  short,  enriches,  and  spending  impoverishes,  the 

community  along  with  the  individual;  which  is  but  saying  in 
other  words,  that  society  at  large  is  richer  by  what  it  expends 
in  maintaining  andT  aiding  productive  labor,  but  poorer  by  what 
it  consumes  in  its  enjoyments.* 


*  It  is  worth  while  to  direct  attention 
to  several  circumstances  which  to  a  cer¬ 
tain  extent  diminish  the  detriment 
caused  to  the  general  wealth  by  the 
prodigality  of  individuals,  or  raise  up  a 
compensation,  more  or  less  ample,  as 


a  consequence  of  the  detriment  itself. 
One  of  these  is  that  spendthrifts  do  not 
usually  succeed  in  consuming  all  they 
spend.  Their  habitual  carelessness  as 
to  expenditure  causes  them  to  be 
cheated  and  robbed  on  all  quarters, 


FUNDAMENTAL  PROPOSITIONS  ON  CAPITAL  73 


§  6.  To  return  to  our  fundamental  theorem.  Everything 
which  is  produced  is  consumed;  both  what  is  saved  and  what  is 
said  to  be  spent;  and  the  former  quite  as  rapidly  as  the  latter. 
All  the  ordinary  forms  of  language  tend  to  disguise  this.  When 
people  talk  of  the  ancient  wealth  of  a  country,  of  riches  inherited 
from  ancestors,  and  similar  expressions,  the  idea  suggested  is, 
that  the  riches  so  transmitted  were  produced  long  ago,  at  the 
time  when  they  are  said  to  have  been  first  acquired,  and  that  no 
portion  of  the  capital  of  the  country  was  produced  this  year, 
except  as  much  as  may  have  been  this  year  added  to  the  total 
amount.  The  fact  is  far  otherwise.  The  greater  part,  in  value, 
of  the  wealth  now  existing  in  England  has  been  produced  by 
human  hands  within  the  last  twelve  months.  A  very  small  pro¬ 
portion  indeed  of  that  large  aggregate  was  in  existence  ten  years 
ago; — of  the  present  productive  capital  of  the  country  scarcely 
any  part,  except  farm-houses  and  manufactories,  and  a  few  ships 
and  machines;  and  even  these  would  not  in  most  cases  have  sur¬ 
vived  so  long,  if  fresh  labor  had  not  been  employed  within  that 
period  in  putting  them  into  repair.  The  land  subsists,  and  the 
land  is  almost  the  only  thing  that  subsists.  Everything  which  is 
produced  perishes,  and  most  things  very  quickly.  Most  kinds 


often  by  persons  of  frugal  habits.  Large 
accumulations  are  continually  made  by 
the  agents,  stewards,  and  even  domestic 
servants,  of  improvident  persons  of  for¬ 
tune;  and  they  pay  much  higher  prices 
for  all  purchases  than  people  of  careful 
habits,  which  accounts  for  their  being 

fiopular  as  customers.  They  are,  there- 
ore,  actually  not  able  to  get  into  their 
possession  and  destroy  a  quantity  of 
wealth  by  any  means  equivalent  to  the 
fortune  which  they  dissipate.  Much  of 
it  is  merely  transferred  to  others,  by 
whom  a  part  may  be  saved.  Another 
thing  to  be  observed  is,  that  the  prodi¬ 
gality  of  some  may  reduce  others  to  a 
forced  economy.  Suppose  a  sudden  de¬ 
mand  for  some  article  of  luxury,  caused 
by  the  caprice  of  a  prodigal,  which  not 
having  been  calculated  on  beforehand, 
there  has  been  no  increase  of  the  usual 
supply.  The  price  will  rise;  and  may 
rise  beyond  the  means  or  the  inclina¬ 
tions  of  some  of  the  habitual  consumers, 
who  may  in  consequence  forego  their 
accustomed  indulgence,  and  save  the 
amount.  If  they  do  not,  but  continue 
to  spend  as  great  a  value  as  before  on 
the  commodity,  the  dealers  in  it  obtain, 
for  only  the  same  quantity  of  the  article, 
a  return  increased  by  the  whole  of  what 
the  spendthrift  has  paid;  and  thus  the 
amount  which  he  loses  is  transferred 
bodily  to  them,  and  may  be  added  to 
their  capital:  his  increased  personal 
consumption  being  made  up  by  the 


privations  of  the  other  purchasers,  who 
have  obtained  less  than  usual  of  their 
accustomed  gratification  for  the  same 
equivalent.  On  the  other  hand,  a  coun¬ 
ter-process  must  be  going  on  some¬ 
where,  since  the  prodigal  must  have 
diminished  his  purchases  in  some  other 
quarter  to  balance  the  augmentation  in 
this;  he  has  perhaps  called  in  funds 
employed  in  sustaining  productive  la¬ 
bor,  and  the  dealers  in  subsistence  and 
in  the  instruments  of  production  have 
had  commodities  left  on  their  hands,  or 
have  received,  for  the  usual  amount  of 
commodities,  a  less  than  usual  return. 
But  such  losses  of  income  or  capital,  by 
industrious  persons,  except  when  of  ex¬ 
traordinary  amount,  are  generally  made 
up  by  increased  pinching  and  privation; 
so  that  the  capital  of  the  community  may 
not  be,  on  the  whole,  impaired,  and  the 
prodigal  may  have  had  his  self-indul¬ 
gence  at  the  expense  not  of  the  perma¬ 
nent  resources,  but  of  the  temporary 
pleasures  and  comforts  of  others.  For 
in  every  case  the  community  are  poorer 
by  what  any  one  spends,  unless  others 
are  in  consequence  led  to  curtail  their 
spending.  There  are  yet  other  and  more 
recondite  ways  in  which  the  profusion 
of  some  may  bring  about  its  compensa¬ 
tion  in  the  extra  savings  of  others;  but 
these  can  only  be  considered  in  that  part 
of  the  Fourth  Book,  which  treats  of  the 
limiting  principle  to  the  accumulation 
of  capital. 


74 


POLITICAL  ECONOMY 


of  capital  are  not  fitted  by  their  nature  to  be  long  preserved. 
There  are  a  few,  and  but  a  few  productions,  capable  of  a  very 
prolonged  existence.  Westminster  Abbey  has  lasted  many  cen¬ 
turies,  with  occasional  repairs;  some  Grecian  sculptures  have 
existed  above  two  thousand  years;  the  Pyramids  perhaps  double 
or  treble  that  time.  But  these  were  objects  devoted  to  unproduc¬ 
tive  use.  If  we  except  bridges  and  aqueducts  (to  which  may  in 
some  countries  be  added  tanks  and  embankments),  there  are 
few  instances  of  any  edifice  applied  to  industrial  purposes  which 
has  been  of  great  duration;  such  buildings  do  not  hold  out 
against  wear  and  tear,  nor  is  it  good  economy  to  construct  them 
of  the  solidity  necessary  for  permanency.  Capital  is  kept  in  ex¬ 
istence  from  age  to  age  not  by  preservation,  but  by  perpetual 
reproduction:  every  part  of  it  is  used  and  destroyed,  generally 
very  soon  after  it  is  produced,  but  those  who  consume  it  are  em¬ 
ployed  meanwhile  in  producing  more.  The  growth  of  capital  is 
similar  to  the  growth  of  population.  Every  individual  who  is 
born,  dies,  but  in  each  year  the  number  born  exceeds  the  number 
who  die:  the  population,  therefore,  always  increases,  though  not 
one  person  of  those  composing  it  was  alive  until  a  very  recent 
date. 

§  7.  This  perpetual  consumption  and  reproduction  of  capital 
afford  the  explanation  of  what  has  so  often  excited  wonder,  the 
great  rapidity  with  which  countries  recover  from  a  state  of  devas¬ 
tation;  the  disappearance,  in  a  short  time,  of  all  traces  of  the 
mischiefs  done  by  earthquakes,  floods,  hurricanes,  and  the  rav¬ 
ages  of  war.  An  enemy  lays  waste  a  country  by  fire  and  sword, 
and  destroys  or  carries  away  nearly  all  the  movable  wealth  ex¬ 
isting  in  it :  all  the  inhabitants  are  ruined,  and  yet  in  a  few  years 
after,  everything  is  much  as  it  was  before.  This  vis  medicatrix 
nature  has  been  a  subject  of  sterile  astonishment,  or  has  been 
cited  to  exemplify  the  wonderful  strength  of  the  principle  of 
saving,  which  can  repair  such  enormous  losses  in  so  brief  an  in¬ 
terval.  There  is  nothing  at  all  wonderful  in  the  matter.  What 
the  enemy  have  destroyed,  would  have  been  destroyed  in  a  little 
time  by  the  inhabitants  themselves:  the  wealth  which  they  so 
rapidly  reproduce,  would  have  needed  to  be  reproduced  and 
would  have  been  reproduced  in  any  case,  and  probably  in  as 
short  a  time.  Nothing  is  changed,  except  that  during  the  re¬ 
production  they  have  not  now  the  advantage  of  consuming  what 
had  been  produced  previously.  The  possibility  of  a  rapid  repair 


FUNDAMENTAL  PROPOSITIONS  ON  CAPITAL 


75 


of  their  disasters,  mainly  depends  on  whether  the  country  has 
been  depopulated.  If  its  effective  population  have  not  been  ex¬ 
tirpated  at  the  time,  and  are  not  starved  afterwards;  then,  with 
the  same  skill  and  knowledge  which  they  had  before,  with  their 
land  and  its  permanent  improvements  undestroyed,  and  the  more 
durable  buildings  probably  unimpaired,  or  only  partially  in¬ 
jured,  they  have  nearly  all  the  requisites  for  their  former  amount 
of  production.  If  there  is  as  much  of  food  left  to  them,  or  of 
valuables  to  buy  food,  as  enables  them  by  any  amount  of  priva¬ 
tion  to  remain  alive  and  in  working  condition,  they  will  in  a 
short  time  have  raised  as  great  a  produce,  and  acquired  col¬ 
lectively  as  great  wealth  and  as  great  a  capital,  as  before;  by 
the  mere  continuance  of  that  ordinary  amount  of  exertion  which 
they  are  accustomed  to  employ  in  their  occupations.  Nor  does 
this  evince  any  strength  in  the  principle  of  saving,  in  the  popular 
sense  of  the  term,  since  what  takes  place  is  not  intentional  ab¬ 
stinence,  but  involuntary  privation. 

Yet  so  fatal  is  the  habit  of  thinking  through  the  medium  of 
only  one  set  of  technical  phrases,  and  so  little  reason  have  studi¬ 
ous  men  to  value  themselves  on  being  exempt  from  the  very 
same  mental  infirmities  which  beset  the  vulgar,  that  this  simple 
explanation  was  never  given  (so  far  as  I  am  aware)  by  any  po¬ 
litical  economist  before  Dr.  Chalmers;  a  writer  many  of  whose 
opinions  I  think  erroneous,  but  who  has  always  the  merit  of 
studying  phenomena  at  first  hand,  and  expressing  them  in  a  lan¬ 
guage  of  his  own,  which  often  uncovers  aspects  of  the  truth  that 
the  received  phraseologies  only  tend  to  hide. 

§  8.  The  same  author  carries  out  this  train  of  thought  to  some 
important  conclusions  on  another  closely  connected  subject,  that 
of  government  loans  for  war  purposes  or  other  unproductive  ex¬ 
penditure.  These  loans,  being  drawn  from  capital  (in  lieu  of 
taxes,  which  would  generally  have  been  paid  from  income,  and 
made  up  in  part  or  altogether  by  increased  economy)  must,  ac¬ 
cording  to  the  principles  we  have  laid  down,  tend  to  impoverish 
the  country:  yet  the  years  in  which  expenditure  of  this  sort  has 
been  on  the  greatest  scale,  have  often  been  years  of  great  ap¬ 
parent  prosperity:  the  wealth  and  resources  of  the  country,  in¬ 
stead  of  diminishing,  have  given  every  sign  of  rapid  increase 
during  the  process,  and  of  greatly  expanded  dimensions  after  its 
close.  This  was  confessedly  the  case  with  Great  Britain  during 
the  last  long  Continental  war;  and  it  would  take  some  space  to 


76 


POLITICAL  ECONOMY 


enumerate  all  the  unfounded  theories  in  political  economy,  to 
which  that  fact  gave  rise,  and  to  which  it  secured  temporary  cre¬ 
dence;  almost  all  tending  to  exalt  unproductive  expenditure,  at 
the  expense  of  productive.  Without  entering  into  all  the  causes 
which  operated,  and  which  commonly  do  operate,  to  prevent 
these  extraordinary  drafts  on  the  productive  resources  of  a  coun¬ 
try  from  being  so  much  felt  as  it  might  seem  reasonable  to  ex¬ 
pect,  we  will  suppose  the  most  unfavorable  case  possible:  that 
the  whole  amount  borrowed  and  destroyed  by  the  government, 
was  abstracted  by  the  lender  from  a  productive  employment  in 
which  it  had  actually  been  invested.  The  capital,  therefore,  of 
the  country,  is  this  year  diminished  by  so  much.  But  unless  the 
amount  abstracted  is  something  enormous,  there  is  no  reason  in 
the  nature  of  the  case  why  next  year  the  national  capital  should 
not  be  as  great  as  ever.  The  loan  cannot  have  been  taken  from 
that  portion  of  the  capital  of  the  country  which  consists  of  tools, 
machinery,  and  buildings.  It  must  have  been  wholly  drawn 
from  the  portion  employed  in  paying  laborers :  and  the  laborers 
will  suffer  accordingly.  But  if  none  of  them  are  starved;  if  their 
wages  can  bear  such  an  amount  of  reduction,  or  if  charity  inter¬ 
poses  between  them  and  absolute  destitution,  there  is  no  reason 
that  their  labor  should  produce  less  in  the  next  year  than  in  the 
year  before.  If  they  produce  as  much  as  usual,  having  been  paid 
less  by  so  many  millions  sterling,  these  millions  are  gained  by 
their  employers.  The  breach  made  in  the  capital  of  the  country 
is  thus  instantly  repaired,  but  repaired  by  the  privations  and 
often  the  real  misery  of  the  laboring  class.  Here  is  ample  rea¬ 
son  why  such  periods,  even  in  the  most  unfavorable  circum¬ 
stances,  may  easily  be  times  of  great  gain  to  those  whose  pros¬ 
perity  usually  passes,  in  the  estimation  of  society,  for  national 
prosperity.* 


*  On  the  other  hand,  it  must  be  re¬ 
membered  that  war  abstracts  from  pro¬ 
ductive  employment  not  only  capital,  but 
likewise  laborers,  that  the  funds  with¬ 
drawn  from  the  remuneration  of  produc¬ 
tive  laborers  are  partly  employed  in  pay¬ 
ing  the  same  or  other  individuals  for  un¬ 
productive  labor;  and  that  by  this  por¬ 
tion  of  its  effects,  war  expenditure  acts 
in  precisely  the  opposite  manner  to  that 
which  Dr.  Chalmers  points  out,  and,  so 
far  as  it  goes,  directly  counteracts  the 
effects  described  in  the  text.  So  far  as 
laborers  are  taken  from  production  to 
man  the  army  and  navy,  the  laboring 
classes  are  not  damaged,  the  capitalists 
are  not  benefited,  and  the  general 
produce  of  the  country  is  diminished  by 


war  expenditure.  Accordingly,  Dr.  Chal¬ 
mers’s  doctrine,  though  true  of  this 
country,  is  wholly  inapplicable  to  coun¬ 
tries  differently  circumstanced;  to 
France,  for  example,  during  the  Napo¬ 
leon  wars.  At  that  period  the  draft 
on  the  laboring  population  of  France, 
for  a  long  series  of  years,  was  enormous, 
while  the  funds  which  supported  the 
war  were  mostly  supplied  by  contribu¬ 
tions  levied  on  the  countries  overrun  by 
the  French  arms,  a  very  small  propor¬ 
tion  alone  consisting  of  French  capital. 
In  France,  accordingly,  the  wages  of 
labor  did  not  fall,  but  rose;  the  em¬ 
ployers  of  labor  were  not  benefited,  but 
injured;  while  the  wealth  of  the  country 
was  impaired  by.  the  suspension  or  total 


FUNDAMENTAL  PROPOSITIONS  ON  CAPITAL  77 


This  leads  to  the  vexed  question  to  which  Dr.  Chalmers  has 
very  particularly  adverted;  whether  the  funds  required  by  a 
government  for  extraordinary  unproductive  expenditure,  are 
best  raised  by  loans,  the  interest  only  being  provided  by 
taxes,  or  whether  taxes  should  be  at  once  laid  onto  the 
whole  amount;  which  is  called  in  the  financial  vocabulary, 
raising  the  whole  of  the  supplies  within  the  year.  Dr. 
Chalmers  is  strongly  for  the  latter  method.  He  says,  the 
common  notion  is  that  in  calling  for  the  whole  amount  in  one 
year,  you  require  what  is  either  impossible,  or  very  inconvenient; 
that  the  people  cannot,  without  great  hardship,  pay  the  whole  at 
once  out  of  their  yearly  income;  and  that  it  is  much  better  to 
require  of  them  a  small  payment  every  year  in  the  shape  of  in¬ 
terest,  than  so  great  a  sacrifice  once  for  all.  To  which  his  answer 
is,  that  the  sacrifice  is  made  equally  in  either  case.  Whatever 
is  spent,  cannot  but  be  drawn  from  yearly  income.  The  whole 
and  every  part  of  the  wealth  produced  in  the  country,  forms,  or 
helps  to  form,  the  yearly  income  of  somebody.  The  privation 
which  it  is  supposed  must  result  from  taking  the  amount  in  the 
shape  of  taxes,  is  not  avoided  by  taking  it  in  a  loan.  The  suffer¬ 
ing  is  not  averted,  but  only  thrown  upon  the  laboring  classes, 
the  least  able,  and  who  least  ought  to  bear  it:  while  all  the  in¬ 
conveniences,  physical,  moral,  and  political,  produced  by  main¬ 
taining  taxes  for  the  perpetual  payment  of  the  interest,  are  in¬ 
curred  in  pure  loss.  Whenever  capital  is  withdrawn  from  pro¬ 
duction,  or  from  the  fund  destined  for  production,  to  be  lent  to 
the  State  and  expended  unproductively,  that  whole  sum  is  with¬ 
held  from  the  laboring  classes:  the  loan,  therefore,  is  in  truth 
paid  off  the  same  year;  the  whole  of  the  sacrifice  necessary  for 
paying  it  off  is  actually  made:  only  it  is  paid  to  the  wrong  per¬ 
sons,  and  therefore  does  not  extinguish  the  claim;  and  paid  by 
the  very  worst  of  taxes,  a  tax  exclusively  on  the  laboring  class. 
And  after  having,  in  this  most  painful  and  unjust  way,  gone 
through  the  whole  effort  necessary  for  .extinguishing  the  debt, 
the  country  remains  charged  with  it,  and  with  the  payment  of  its 
interest  in  perpetuity. 

These  views  appear  to  me  strictly  just,  in  so  far  as  the  value 


loss  of  so  vast  an  amount  of  its  produc¬ 
tive  labor.  In  England  all  this  was  re¬ 
versed.  England  employed  compara¬ 
tively  few  additional  soldiers  and  sailors 
of  her  own,  while  she  diverted  hundreds 
of  millions  of  capital  from  productive 
employment,  to  supply  munitions  of 


war  and  support  armies  for  her  Conti¬ 
nental  allies.  Consequently,  as  shown 
in  the  text,  her  laborers  suffered,  her 
capitalists  prospered,"  and  her  perma¬ 
nent  productive  resources  did  not  fall 
off. 


78 


POLITICAL  ECONOMY 


absorbed  in  loans  would  otherwise  have  been  employed  in  pro¬ 
ductive  industry  within  the  country.  The  practical  state  of  the 
case,  however,  seldom  exactly  corresponds  with  this  supposition. 
The  loans  of  the  less  wealthy  countries  are  made  chiefly  with 
foreign  capital,  which  would  not,  perhaps,  have  been  brought 
in  to  be  invested  on  any  less  security  than  that  of  the  govern¬ 
ment  :  while  those  of  rich  and  prosperous  countries  are  generally 
made,  not  with  funds  withdrawn  from  productive  employment, 
but  with  the  new  accumulations  constantly  making  from  income, 
and  often  with  a  part  of  them  which,  if  not  so  taken,  would  have 
migrated  to  colonies,  or  sought  other  investments  abroad.  In 
these  cases  (which  will  be  more  particularly  examined  here¬ 
after*),  the  sum  wanted  may  be  obtained  by  loan  without  detri¬ 
ment  to  the  laborers,  or  derangement  of  the  national  industry, 
and  even  perhaps  with  advantage  to  both,  in  comparison  with 
raising  the  amount  by  taxation;  since  taxes,  especially  when 
heavy,  are  almost  always  partly  paid  at  the  expense  of  what 
would  otherwise  have  been  saved  and  added  to  capital.  Besides, 
in  a  country  which  makes  so  great  yearly  additions  to  its  wealth 
that  a  part  can  be  taken  and  expended  unproductively  without 
diminishing  capital,  or  even  preventing  a  considerable  increase, 
it  is  evident  that  even  if  the  whole  of  what  is  so  taken  would  have 
become  capital,  and  obtained  employment  in  the  country,  the 
effect  on  the  laboring  classes  is  far  less  prejudicial,  and  the  case 
against  the  loan  system  much  less  strong,  than  in  the  case  first 
supposed.  This  brief  anticipation  of  a  discussion  which  will  find 
its  proper  place  elsewhere,  appeared  necessary  to  prevent  false 
inferences  from  the  premises  previously  laid  down. 

§  9.  We  now  pass  to  aMourth  fundamental  theorem  respect¬ 
ing  Capital,  which  is,  perhaps,  oftener  overlooked  or  miscon¬ 
ceived  than  even  any  of  the  foregoing.  Whatjsupports  and  em¬ 
ploys  productive  labor,  is  the  capital  expended  in  setting  it  to 
work,  and  not  the  demancTof  purchasers  for  the  produce  of  the 
labor  when  completed.  Demand  for  commodities  is  not  demand 
for  labor.  JThe  demand  for  commodities  determines  in  what  par- 
ticular  branch  of  production  the  labor  and  capital  shall  be  em¬ 
ployed  ;  it  determines  the  direction  of  the  labor;  but  not  the 
more  or  less  of  the  labor  itself,  or  of  the  maintenance  or  payment 
of  the  labor.  These  depend  on  the  amount  of  the  capital,  or 
other  funds  directly  devoted  to  the  sustenance  and  remuneration 

of  labor. 

•— — ■ — - — 


*  Infra,  book  iv.  chaps,  iv.  v. 


FUNDAMENTAL  PROPOSITIONS  ON  CAPITAL  79 


Suppose,  for  instance,  that  there  is  a  demand  for  velvet;  a 
fund  ready  to  be  laid  out  in  buying  velvet,  but  no  capital  to  es¬ 
tablish  the  manufacture.  It  is  of  no  consequence  how  great  the 
demand  may  be;  unless  capital  is  attracted  into  the  occupation, 
there  will  be  no  velvet  made,  and  consequently  none  bought; 
unless,  indeed,  the  desire  of  the  intending  purchaser  for  it  is  so 
strong,  that  he  employs  part  of  the  price  he  would  have  paid  for 
it,  in  making  advances  to  work-people,  that  they  may  employ 
themselves  in  making  velvet;  that  is,  unless  he  converts  part  of 
his  income  into  capital,  and  invests  that  capital  in  the  manufact¬ 
ure.  Let  us  now  reverse  the  hypothesis,  and  suppose  that  there 
is  plenty  of  capital  ready  for  making  velvet,  but  no  demand. 
Velvet  will  not  be  made;  but  there  is  no  particular  preference 
on  the  part  of  capital  for  making  velvet.  Manufacturers  and 
their  laborers  do  not  produce  for  the  pleasure  of  their  customers, 
but  for  the  supply  of  their  own  wants,  and  having  still  the  capital 
and  the  labor  which  are  the  essentials  of  production,  they  can 
either  produce  something  else  which  is  in  demand,  or  if  there  be 
no  other  demand,  they  themselves  have  one,  and  can  produce  the 
things  which  they  want  for  their  own  consumption.  So  that  the 
employment  afforded  to  labor  does  not  depend  on  the  purchasers, 
but  on  the  capital.  I  am,  of  course,  not  taking  into  consideration 
the  effects  of  a  sudden  change.  If  the  demand  ceases  unex¬ 
pectedly,  after  the  commodity  to  supply  it  is  already  produced, 
this  introduces  a  different  element  into  the  question :  the  capital 
has  actually  been  consumed  in  producing  something  which  no¬ 
body  wants  or  uses,  and  it  has  therefore  perished,  and  the  em¬ 
ployment  which  it  gave  to  labor  is  at  an  end,  not  because  there 
is  no  longer  a  demand,  but  because  there  is  no  longer  a  capital. 
This  case  therefore  does  not  test  the  principle.  The  proper  test 
is,  to  suppose  that  the  change  is  gradual  and  foreseen,  and  is  at¬ 
tended  with  no  waste  of  capital,  the  manufacture  being  discon¬ 
tinued  by  merely  not  replacing  the  machinery  as  it  wears  out, 
and  not  reinvesting  the  money  as  it  comes  in  from  the  sale  of 
the  produce.  The  capital  is  thus  ready  for  a  new  employment, 
in  which  it  will  maintain  as  much  labor  as  before.  The  manu¬ 
facturer  and  his  work-people  lose  the  benefit  of  the  skill  and 
knowledge  which  they  had  acquired  in  the  particular  business, 
and  which  can  only  be  partially  of  use  to  them  in  any  other;  and 
that  is  the  amount  of  loss  to  the  community  by  the  change.  But 
the  laborers  can  still  work,  and  the  capital  which  previously  em- 


8o 


POLITICAL  ECONOMY 


ployed  them  will,  either  in  the  same  hands,  or  by  being  lent  to 
others,  employ  either  those  laborers  or  an  equivalent  number  in 
some  other  occupation. 

This  theorem,  that  to  purchase  produce  is  not  to  employ 
labor;  that  the  demand  for  labor  is  constituted  by  the  wages 
which  precede  the  production,  and  not  by  the  demand  which 
may  exist  for  the  commodities  resulting  from  the  production;  is 
a  proposition  which  greatly  needs  all  the  illustration  it  can  re¬ 
ceive.  It  is,  to  common  apprehension,  a  paradox;  and  even 
among  political  economists  of  reputation,  I  can  hardly  point  to 
any,  except  Mr.  Ricardo  and  M.  Say,  who  have  kept  it  con¬ 
stantly  and  steadily  in  view.  Almost  all  others  occasionally  ex¬ 
press  themselves  as  if  a  person  who  buys  commodities,  the  prod¬ 
uce  of  labor,  was  an  employer  of  labor,  and  created  a  demand  for 
it  as  really,  and  in  the  same  sense,  as  if  he  bought  the  labor  it¬ 
self  directly,  by  the  payment  of  wages.  It  is  no  wonder  that  po¬ 
litical  economy  advances  slowly,  when  such  a  question  as  this 
still  remains  open  at  its  very  threshold.  I  apprehend,  that  if  by 
demand  for  labor  be  meant  the  demand  by  which  wages  are 
raised,  or  the  number  of  laborers  in  employment  increased, 
demand  for  commodities  does  not  constitute  demand  for  labor. 
I  conceive  that  a  person  who  buys  commodities  and  consumes 
them  himself,  does  no  good  to  the  laboring  classes,  and  that  it  is 
only  by  what  he  abstains  from  consuming,  and  expends  in  di¬ 
rect  payments  to  laborers  in  exchange  for  labor,  that  he  benefits 
the  laboring  classes,  or  adds  anything  to  the  amount  of  their 
employment. 

For  the  better  illustration  of  the  principle,  let  us  put  the  fol¬ 
lowing  case.  A  consumer  may  expend  his  income  either  in  buy¬ 
ing  services  or  commodities.  He  may  employ  part  of  it  in  hir¬ 
ing  journeymen  bricklayers  to  build  a  house,  or  excavators  to 
dig  artificial  lakes,  or  laborers  to  make  plantations  and  lay  out 
pleasure-grounds;  or,  instead  of  this,  he  may  expend  the  same 
value  in  buying  velvet  and  lace.  The  question  is,  whether  the 
difference  between  these  two  modes  of  expending  his  income 
affects  the  interest  of  the  laboring  classes.  It  is  plain  that  in  the 
first  of  the  two  cases  he  employs  laborers,  who  will  be  out  of  em¬ 
ployment,  or  at  least  out  of  that  employment,  in  the  opposite 
case.  But  those  from  whom  I  differ  say  that  this  is  of  no  conse¬ 
quence,  because  in  buying  velvet  and  lace  he  equally  employs 
laborers,  namely,  those  who  make  the  velvet  and  lace.  I  con- 


FUNDAMENTAL  PROPOSITIONS  ON  CAPITAL  81 


tend,  however,  that  in  this  last  case  he  does  not  employ  laborers; 
but  merely  decides  in  what  kind  of  work  some  other  person  shall 
employ  them.  The  consumer  does  not  with  his  own  funds  pay 
to  the  weavers  and  lacemakers  their  day’s  wages.  He  buys  the 
finished  commodity,  which  has  been  produced  by  labor  and  capi¬ 
tal,  the  laborer  not  being  paid  nor  the  capital  furnished  by  him, 
but  by  the  manufacturer.  Suppose  that  he  had  been  in  the  habit 
of  expending  this  portion  of  his  income  in  hiring  journeymen 
bricklayers,  who  laid  out  the  amount  of  their  wages  in  food  and 
clothing,  which  were  also  produced  by  labor  and  capital.  He, 
however,  determines  to  prefer  velvet,  for  which  he  thus  creates 
an  extra  demand.  This  demand  cannot  be  satisfied  without  an 
extra  supply,  nor  can  the  supply  be  produced  without  an  extra 
capital;  where,  then,  is  the  capital  to  come  from?  There  is  noth¬ 
ing  in  the  consumer’s  change  of  purpose  which  makes  the  capital 
of  the  country  greater  than  it  otherwise  was.  It  appears,  then, 
that  the  increased  demand  for  velvet  could  not  for  the  present  be 
supplied,  were  it  not  that  the  very  circumstance  which  gave  rise 
to  it  has  set  at  liberty  a  capital  of  the  exact  amount  required.  The 
very  sum  which  the  consumer  now  employs  in  buying  velvet, 
formerly  passed  into  the  hands  of  journeymen  bricklayers,  who 
expended  it  in  food  and  necessaries,  which  they  now  either  go 
without,  or  squeeze,  by  their  competition,  from  the  shares 
of  other  laborers.  The  labor  and  capital,  therefore,  which 
formerly  produced  necessaries  for  the  use  of  these  brick¬ 
layers,  are  deprived  of  their  market,  and  must  look  out 
for  other  employment;  and  they  find  it  in  making  velvet  for 
the  new  demand.  I  do  not  mean  that  the  very  same  labor  and 
capital  which  produced  the  necessaries  turn  themselves  to  pro¬ 
ducing  the  velvet;  but,  in  some  one  or  other  of  a  hundred  modes, 
they  take  the  place  of  that  which  does.  There  was  capital  in  ex¬ 
istence  to  do  one  of  two  things — to  make  the  velvet,  or  to  pro¬ 
duce  necessaries  for  the  journeyman  bricklayers;  but  not  to  do 
both.  It  was  at  the  option  of  the  consumer  which  of  the  two 
should  happen;  and  if  he  chooses  the  velvet,  they  go  without  the 
necessaries. 

For  further  illustration,  let  us  suppose  the  same  case  reversed. 
The  consumer  has  been  accustomed  to  buy  velvet,  but  resolves 
to  discontinue  that  expense,  and  to  employ  the  same  annual  sum 
in  hiring  bricklayers.  If  the  common  opinion  be  correct,  this 
change  in  the  mode  of  his  expenditure  gives  no  additional  em- 
Vol.  I. — 6 


8  2 


POLITICAL  ECONOMY 


ployment  to  labor,  but  only  transfers  employment  from  velvet- 
makers  to  bricklayers.  On  closer  inspection,  however,  it  will  be 
seen  that  there  is  an  increase  of  the  total  sum  applied  to  the  re¬ 
muneration  of  labor.  The  velvet  manufacturer,  supposing  him 
aware  of  the  diminished  demand  for  his  commodity,  diminishes 
the  production,  and  sets  at  liberty  a  corresponding  portion  of 
the  capital  employed  in  the  manufacture.  This  capital,  thus  with¬ 
drawn  from  the  maintenance  of  velvet-makers,  is  not  the  same 
fund  with  that  which  the  customer  employs  in  maintaining  brick¬ 
layers;  it  is  a  second  fund.  There  are  therefore  two  funds  to  be 
employed  in  the  maintenance  and  remuneration  of  labor,  where 
before  there  was  only  one.  There  is  not  a  transfer  of  employ¬ 
ment  from  velvet-makers  to  bricklayers;  there  is  a  new  employ¬ 
ment  created  for  bricklayers,  and  a  transfer  of  employment  from 
velvet-makers  to  some  other  laborers,  most  probably  those  who 
produce  the  food  and  other  things  which  the  bricklayers  con¬ 
sume. 

In  answer  to  this  it  is  said,  that  though  money  laid  out  in  buy¬ 
ing  velvet  is  not  capital,  it  replaces  a  capital;  that  though  it  does 
not  create  a  new  demand  for  labor,  it  is  the  necessary  means  of 
enabling  the  existing  demand  to  be  kept  up.  The  funds  (it  may 
be  said)  of  the  manufacturer,  while  locked  up  in  velvet,  cannot 
be  directly  applied  to  the  maintenance  of  labor;  they  do  not 
begin  to  constitute  a  demand  for  labor  until  the  velvet  is  sold, 
and  the  capital  which  made  it  replaced  from  the  outlay  of  the 
purchaser;  and  thus,  it  may  be  said,  the  velvet-maker  and  the 
velvet-buyer  have  not  two  capitals,  but  only  one  capital  between 
them,  which  by  the  act  of  purchase  the  buyer  transfers  to  the 
manufacturer:  and  if  instead  of  buying  velvet  he  buys  labor,  he 
simply  transfers  this  capital  elsewhere,  extinguishing  as  much 
demand  for  labor  in  one  quarter  as  he  creates  in  another. 

The  premises  of  this  argument  are  not  denied.  To  set  free  a 
capital  which  would  otherwise  be  locked  up  in  a  form  useless  for 
the  support  of  labor,  is,  no  doubt,  the  same  thing  to  the  interests 
of  laborers  as  the  creation  of  a  new  capital.  It  is  perfectly  true 
that  if  I  expend  £1,000  in  buying  velvet,  I  enable  the  manufact¬ 
urer  to  employ  £1,000  in  the  maintenance  of  labor,  which  could 
not  have  been  so  employed  while  the  velvet  remained  unsold: 
and  if  it  would  have  remained  unsold  forever  unless  I  bought  it, 
then  by  changing  my  purpose  and  hiring  bricklayers  instead,  I 
undoubtedly  create  no  new  demand  for  labor:  for  while  I  em- 


FUNDAMENTAL  PROPOSITIONS  ON  CAPITAL  83 


ploy  £1,000  in  hiring  labor  on  the  one  hand,  I  annihilate  forever 
£1,000  of  the  velvet-maker’s  capital  on  the  other.  But  this 
is  confounding  the  effects  arising  from  the  mere  suddenness  of  a 
change  with  the  effects  of  the  change  itself.  If  when  the  buyer 
ceased  to  purchase,  the  capital  employed  in  making  velvet  for  his 
use  necessarily  perished,  then  his  expending  the  same  amount 
in  hiring  bricklayers  would  be  no  creation,  but  merely  a  transfer, 
of  employment.  The  increased  employment  which  I  contend  is 
given  to  labor,  would  not  be  given  unless  the  capital  of  the 
velvet-maker  could  be  liberated,  and  would  not  be  given 
until  it  was  liberated.  But  everyone  knows  that  the  capital 
invested  in  an  employment  can  be  withdrawn  from  it,  if  sufficient 
time  be  allowed.  If  the  velvet-maker  had  previous  notice,  by  not 
receiving  the  usual  order,  he  will  have  produced  £1,000  less  vel¬ 
vet,  and  an  equivalent  portion  of  his  capital  will  have  been  al¬ 
ready  set  free.  If  he  had  no  previous  notice,  and  the  article  con¬ 
sequently  remains  on  his  hands,  the  increase  of  his  stock  will 
induce  him  next  year  to  suspend  or  diminish  his  production  until 
the  surplus  is  carried  off.  When  this  process  is  complete,  the 
manufacturer  will  find  himself  as  rich  as  before,  with  undimin¬ 
ished  power  of  employing  labor  in  general,  though  a  portion  of 
his  capital  will  now  be  employed  in  maintaining  some  other  kind 
of  it.  Until  this  adjustment  has  taken  place,  the  demand  for 
labor  will  be  merely  changed,  not  increased:  but  as  soon 
as  it  has  taken  place,  the  demand  for  labor  is  increased. 
Where  there  was  formerly  only  one  capital  employed  in 
maintaining  weavers  to  make  £1,000  worth  of  velvet,  there 
is  now  that  same  capital  employed  in  making  something 
else,  and  £1,000  distributed  among  bricklayers  besides.  There 
are  now  two  capitals  employed  in  remunerating  two  sets  of 
laborers;  while  before,  one  of  those  capitals,  that  of  the  cus¬ 
tomer,  only  served  as  a  wheel  in  the  machinery  by  which  the 
other  capital,  that  of  the  manufacturer,  carried  on  its  employ¬ 
ment  of  labor  from  year  to  year. 

The  proposition  for  which  I  am  contending  is  in  reality  equiva¬ 
lent  to  the  following,  which  to  some  minds  will  appear  a  truism, 
though  to  others  it  is  a  paradox:  that  a  person  does  good  to 
laborers,  not  by  what  he  consumes  on  himself,  but  solely  by 
what  he  does  not  so  consume.  If  instead  of  laying  out  £100  in 
wine  or  silk,  I  expend  it  in  wages,  the  demand  for  commodities 
is  precisely  equal  in  both  cases:  in  the  one,  it  is  a  demand  for 


84 


POLITICAL  ECONOMY 


£100  worth  of  wine  or  silk,  in  the  other,  for  the  same  value  of 
bread,  beer,  laborers’  clothing,  fuel,  and  indulgences;  but  the  la¬ 
borers  of  the  community  have  in  the  latter  case  the  value  of  £100 
more  of  the  produce  of  the  community  distributed  among  them. 
I  have  consumed  that  much  less,  and  made  over  my  consuming 
power  to  them.  If  it  were  not  so,  my  having  consumed  less 
would  not  leave  more  to  be  consumed  by  others;  which  is  a 
manifest  contradiction.  When  less  is  not  produced,  what  one 
person  forbears  to  consume  is  necessarily  added  to  the  share  of 
those  to  whom  he  transfers  his  power  of  purchase.  In  the  case 
supposed  I  do  not  necessarily  consume  less  ultimately,  since  the 
laborers  whom  I  pay  may  build  a  house  for  me,  or  make  some¬ 
thing  else  for  my  future  consumption.  But  I  have  at  all  events 
postponed  my  consumption,  and  have  turned  over  part  of  my 
share  of  the  present  produce  of  the  community  to  the  laborers. 
If  after  an  interval  I  am  indemnified,  it  is  not  from  the  existing 
produce,  but  from  a  subsequent  addition  made  to  it.  I  have 
therefore  left  more  of  the  existing  produce  to  be  consumed  by 
others;  and  have  put  into  the  possession  of  laborers  the  power 
to  consume  it. 

There  cannot  be  a  better  reductio  ad  absurdum  of  the  oppo¬ 
site  doctrine  than  that  afforded  by  the  Poor  Law.  If  it  be  equally 
for  the  benefit  of  the  laboring  classes  whether  I  consume  my 
means  in  the  form  of  things  purchased  for  my  own  use,  or  set 
aside  a  portion  in  the  shape  of  wages  or  alms  for  their  direct  con¬ 
sumption,  on  what  ground  can  the  policy  be  justified  of  taking 
my  money  from  me  to  support  paupers?  since  my  unproductive 
expenditure  would  have  equally  benefited  them,  while  I  should 
have  enjoyed  it  too.  If  society  can  both  eat  its  cake  and  have  it, 
why  should  it  not  be  allowed  the  double  indulgence?  But  com¬ 
mon  sense  tells  everyone  in  his  own  case  (though  he  does  not  see 
it  on  the  larger  scale)  that  the  poor-rate  which  he  pays  is  really 
subtracted  from  his  own  consumption;  and  that  no  shifting  of 
payment  backwards  and  forwards  will  enable  two  persons  to  eat 
the  same  food.  If  he  had  not  been  required  to  pay  the  rate,  and 
had  consequently  laid  out  the  amount  on  himself,  the  poor  would 
have  had  as  much  less  for  their  share  of  the  total  produce  of  the 
country,  as  he  himself  would  have  consumed  more.* 

*  The  following  case,  which  presents  Suppose  that  a  rich  individual.  A,  ex- 
the  argument  in  a  somewhat  different  pends  a  certain  amount  daily  in  wages 
shape,  may  serve  for  still  further  illus-  or  alms,  which,  as  soon  as  received,  is 
tration:  expended  and  consumed,  in  the  form  of 


FUNDAMENTAL  PROPOSITIONS  ON  CAPITAL  85 


It  appears,  then,  that  a  demand  delayed  until  the  work  is  com¬ 
pleted,  and  furnishing  no  advances,  but  only  reimbursing  ad¬ 
vances  made  by  others,  contributes  nothing  to  the  demand  for 
labor;  and  that  what  is  so  expended,  is,  in  all  its  effects,  so  far 
as  regards  the  employment  of  the  laboring  class,  a  mere  nullity; 
it  does  not  and  cannot  create  any  employment  except  at  the  ex¬ 
pense  of  other  employment  which  existed  before. 


coarse  food,  by  the  receivers.  A  dies, 
leaving  his  property  to  B,  who  discon¬ 
tinues  this  item  of  expenditure,  and  ex¬ 
pends  in  lieu  of  it  the  same  sum  each 
day  in  delicacies  for  his  own  table.  I 
have  chosen  this  supposition,  in  order 
that  the  two  cases  may  be  similar  in  all 
their  circumstances,  except  that  which 
is  the  subject  of  comparison.  In  order 
not  to  obscure  the  essential  facts  of  the 
case  by  exhibiting  them  through  the 
hazy  medium  of  a  money  transaction, 
let  us  further  suppose  that  A,  and  B  af¬ 
ter  him,  are  landlords  of  the  estate  on 
which  both  the  food  consumed  by  the 
recipients  of  A’s  disbursements,  and  the 
articles  of  luxury  supplied  for  B’s  table, 
are  produced;  and  that  their  rent  is  paid 
to  them  in  kind,  they  giving  previous 
notice  what  description  of  produce  they 
shall  require.  The  question  is,  whether 
B’s  expenditure  gives  as  much  employ¬ 
ment  or  as  much  food  to  his  poorer 
neighbors  as  A’s  gave. 

From  the  case  as  stated,  it  seems  to 
follow  that  while  A  lived,  that  portion 
of  his  income  which  he  expended  in 
wages  or  alms,  would  be  drawn  by  him 
from  the  farm  in  the  shape  of  food  for 
laborers,  and  would  be  used  as  such; 
while  B,  who  came  after  him,  would  re¬ 
quire,  instead  of  this,  an  equivalent 
value  in  expensive  articles  of  food,  to 
be  consumed  in  his  own  household:  that 
the  farmer,  therefore,  would,  under  B’s 
regime,  produce  that  much  less  of  or¬ 
dinary  food,  and  more  of  expensive  deli¬ 
cacies,  for  each  day  of  the  year,  than 
was  produced  in  A’s  time,  and  that  there 
would  be  that  amount  less  of  food 
shared,  throughout  the  year,  among  the 
laboring  and  poorer  classes.  This  is 
what  would  be  conformable  to  the  prin¬ 
ciples  laid  down  in  the  text.  Those  who 
think  differently,  must,  on  the  other 
hand,  suppose  that  the  luxuries  required 
by  B  would  be  produced,  not  instead  of, 
but  in  addition  to,  the  food  previously 
supplied  to  A’s  laborers,  and  that  the 
aggregate  produce  of  the  country  would 
be  increased  in  amount.  But  when  it 
is  asked,  how  this  double  production 
would  be  effected— how  the  farmer, 
whose  capital  and  labor  were  already 
fully  employed,  would  be  enabled  to  sup¬ 
ply  the  new  wants  of  B,  without  pro¬ 
ducing  less  of  other  things;  the  only 
mode  which  presents  itself  is,  that  he 
should  first  produce  the  food,  and  then, 
giving  that  food  to  the  laborers  whom 
A  formerly  fed,  should  by  means  of  their 
labor,  produce  the  luxuries  wanted  by 
B.  This,  accordingly,  when  the  ob¬ 
jectors  are  hard  pressed,  appears  to  be 


really  their  meaning.  But  it  is  an  ob¬ 
vious  answer,  that  on  this  supposition, 
B  must  wait  for  his  luxuries  till  the  sec¬ 
ond  year,  and  they  are  wanted  this  year. 
By  the  original  hypothesis,  he  consumes 
his  luxurious  dinner  day  by  day,  pari 
passu  with  the  rations  of  bread  and 
potatoes  formerly  served  out  by  A  to 
his  laborers.  There  is  not  time  to  feed 
the  laborers  first,  and  supply  B  after¬ 
wards:  he  and  they  cannot  both  have 
their  wants  ministered  to:  he  can  only 
satisfy  his  own  demand  for  commodi¬ 
ties,  by  leaving  as  much  of  theirs,  as  was 
formerly  supplied  from  that  fund,  un¬ 
satisfied. 

It  may,  indeed,  be  rejoined  by  an 
objector,  that,  since  on  the  present  show¬ 
ing,  time  is  the  only  thing  wanting  to 
render  the  expenditure  of  B  consistent 
with  as  large  an  employment  to  labor  as 
was  given  by  A,  why  may  we  not  sup¬ 
pose  that  B  postpones  his  increased  con¬ 
sumption  of  personal  luxuries  until  they 
can  be  furnished  to  him  by  the  labor  of 
the  persons  whom  A  employed?  In  that 
case,  it  may  be  said,  he  would  employ 
and  feed  as  much  labor  as  his  predeces¬ 
sors.  Undoubtedly  he  would;  but  why? 
Because  his  income  would  be  expended 
in  exactly  the  same  manner  as  his  pred¬ 
ecessor’s;  it  would  be  expended  in 
wages.  A  reserved  from  his  personal 
consumption  a  fund  which  he  paid  away 
directly  to  laborers;  B  does  the  same, 
only  instead  of  paying  it  to  them  him¬ 
self,  he  leaves  it  in  the  hands  of  the 
farmer,  who  pays  it  to  them  for  him. 
On  this  supposition  B,  in  the  first  year, 
neither  expending  the  amount,  as  far 
as  he  is  personally  concerned,  in  A’s 
manner  nor  in  his  own,  really  saves  that 
portion  of  his  income,  and  lends  it  to 
the  farmer.  And  if,  in  subsequent  years, 
confining  himself  within  the  year’s  in¬ 
come,  he  leaves  the  farmer  in  arrears  to 
that  amount,  it  becomes  an  additional 
capital,  with  which  the  farmer  may  per¬ 
manently  employ  and  feed  A’s  laborers. 
Nobody  pretends  that  such  a  change  as 
this,  a  change  from  spending  an  in¬ 
come  in  wages  of  labor,  to  saving  it  for 
investment,  deprives  any  laborers  of  em¬ 
ployment.  What  is  affirmed  to  have 
that  effect  is,  the  change  from  hiring  la¬ 
borers  to  buying  commodities  for  per¬ 
sonal  use;  as  represented  by  our  original 
hypothesis. 

In  our  illustration  we  have  supposed 
no  buying  and  selling,  or  use  of  money. 
But  the  case  as  we  have  put  it,  corre¬ 
sponds  with  actual  fact  in  everything 
except  the  details  of  the  mechanism. 
The  whole  of  any  country  is  virtually  a 


36 


POLITICAL  ECONOMY 


But  though  a  demand  for  velvet  does  nothing  more  in  regard 
to  the  employment  for  labor  and  capital,  than  to  determine  so 
much  of  the  employment  which  already  existed,  into  that  par¬ 
ticular  channel  instead  of  any  other;  still,  to  the  producers  al¬ 
ready  engaged  in  the  velvet  manufacture,  and  not  intending  to 
quit  it,  this  is  of  the  utmost  importance.  To  them,  a  falling  off 
in  the  demand  is  a  real  loss,  and  one  which,  even  if  none  of  their 
goods  finally  perish  unsold,  may  mount  to  any  height,  up  to  that 
which  would  make  them  choose,  as  the  smaller  evil,  to  retire 
from  the  business.  On  the  contrary,  an  increased  demand  en¬ 
ables  them  to  extend  their  transactions — to  make  a  profit  on  a 
larger  capital,  if  they  have  it,  or  can  borrow  it;  and,  turning  over 
their  capital  more  rapidly,  they  will  employ  their  laborers  more 
constantly,  or  employ  a  greater  number  than  before.  So  that 
an  increased  demand  for  a  commodity  does  really,  in  the  par¬ 
ticular  department,  often  cause  a  greater  employment  to  be  given 
to  labor  by  the  same  capital.  The  mistake  lies  in  not  perceiv¬ 
ing  that  in  the  cases  supposed,  this  advantage  is  given  to  labor 
and  capital  in  one  department,  only  by  being  withdrawn  from 
another;  and  that  when  the  change  has  produced  its  natural  ef¬ 
fect  of  attracting  into  the  employment  additional  capital  propor¬ 
tional  to  the  increased  demand,  the  advantage  itself  ceases. 

The  grounds  of  a  proposition,  when  well  understood,  usually 
give  a  tolerable  indication  of  the  limitations  of  it.  The  general 
principle,  now  stated  is.  that  demand  for  commodities  deter- 
mines  merely  the  direction  of  labor,  and  the  Lind  of  wealth  pro¬ 
duced,  buTnot  the  quantityLQL  efficiency  of  the  labor,  or  the  ag¬ 
gregate  of  wealth.  But  to  this  there  are  two  exceptions.  First; 
when  labor  is  supported,  but  not  fully  occupied,  a  new  demand 
for  something  which  it  can  produce,  may  stimulate  the  labor 
thus  supported  to  increased  exertions,  of  which  the  result  may 
be  an  increase  of  wealth,  to  the  advantage  of  the  laborers  them- 


single  farm  and  manufactory,  from 
which  every  member  of  the  community 
draws  his  appointed  share  of  the  prod¬ 
uce,  having  a  certain  number  of  coun¬ 
ters,  called  pounds  sterling,  put  into 
his  hands,  which,  at  his  convenience, 
he  brings  back  and  exchanges  for  such 
goods  as  he  prefers,  up  to  the  limit 
of  the  amount.  He  does  not,  as  in  our 
imaginary  case,  give  notice  beforehand 
what  things  he  shall  require;  but  the 
dealers  and  producers  are  quite  capable 
of  finding  it  out  by  observation,  and 
any  change  in  the  demand  is  promptly 
followed  by  an  adaptation  of  the  supply 


to  it.  If  a  consumer  changes  from  pay¬ 
ing  away  a  part  of  his  income  in  wages, 
to  spending  it  that  same  day  (not  some 
subsequent  and  distant  day)  in  things 
for  his  own  consumption,  and  perseveres 
in  this  altered  practice  until  production 
has  had  time  to  adaot  itself  to  the  alter¬ 
ation  of  demand,  there  will  from  that 
time  be  less  food  and  other  articles  for 
the  use  of  laborers,  produced  in  the 
country,  by  exactly  the  value  of  the 
extra  luxuries  now  demanded;  and  the 
laborers,  as  a  class,  will  be  worse  off  by 
the  precise  amount. 


FUNDAMENTAL  PROPOSITIONS  ON  CAPITAL  87 


selves  and  of  others.  Work  which  can  be  done  in  the  spare 
hours  of  persons  subsisted  from  some  other  source,  can  (as  be¬ 
fore  remarked)  be  undertaken  without  withdrawing  capital  from 
other  occupations,  beyond  the  amount  (often  very  small)  re¬ 
quired  to  cover  the  expense  of  tools  and  materials;  and  even 
this  will  often  be  provided  by  savings  made  expressly  for  the  pur¬ 
pose.  The  reason  of  our  theorem  thus  failing,  the  theorem  it¬ 
self  fails,  and  employment  of  this  kind  may,  by  the  springing  up 
of  a  demand  for  the  commodity,  be  called  into  existence  without 
depriving  labor  of  an  equivalent  amount  of  employment  in  any 
other  quarter.  The  demand  does  not,  even  in  this  case,  operate 
on  labor  any  other  wise  than  through  the  medium  of  an  existing 
capital;  but  it  affords  an  inducement  which  causes  that  capital 
to  set  in  motion  a  greater  amount  of  labor  than  it  did  before. 

The  second  exception,  of  which  I  shall  speak  at  length  in  a 
subsequent  chapter,  consists  in  the  known  effect  of  an  extension 
of  the  market  for  a  commodity,  in  rendering  possible  an  in¬ 
creased  development  of  the  division  of  labor,  and  hence  a  more 
effective  distribution  of  the  productive  forces  of  society.  This, 
like  the  former,  is  more  an  exception  in  appearance,  than  it  is 
in  reality.  It  is  not  the  money  paid  by  the  purchaser  which  re¬ 
munerates  the  labor;  it  is  the  capital  of  the  producer:  the  de¬ 
mand  only  determines  in  what  manner  that  capital  shall  be  em¬ 
ployed,  and  what  kind  of  labor  it  shall  remunerate;  but  if  it  de¬ 
termines  that  the  commodity  shall  be  produced  on  a  large  scale, 
it  enables  the  same  capital  to  produce  more  of  the  commodity, 
and  may,  by  an  indirect  effect  in  causing  an  increase  of  capital, 
produce  an  eventual  increase  of  the  remuneration  of  the  laborer. 

The  demand  for  commodities  is  a  consideration  of  importance 
rather  in  the  theory  of  exchange,  than  in  that  of  production. 
Looking  at  things  in  the  aggregate,  and  permanently,  the  re¬ 
muneration  of  the  producer  is  derived  from  the  productive 
power  of  his  own  capital.  The  sale  of  the  produce  for  money, 
and  the  subsequent  expenditure  of  the  money  in  buying  other 
commodities,  are  a  mere  exchange  of  equivalent  values,  for 
mutual  accommodation.  It  is  true  that,  the  division  of  employ¬ 
ments  being  one  of  the  principal  means  of  increasing  the  pro¬ 
ductive  power  of  labor,  the  power  of  exchanging  gives  rise  to 
a  great  increase  of  the  produce ;  but  even  then  it  is  production, 
not  exchange,  which  remunerates  labor  and  capital.  We  cannot 
too  strictly  represent  to  ourselves  the  operation  of  exchange, 


88 


POLITICAL  ECONOMY 


whether  conducted  by  barter  or  through  the  medium  of  money, 
as  the  mere  mechanism  by  which  each  person  transforms  the 
remuneration  of  his  labor  or  of  his  capital  into  the  particular 
shape  in  which  it  is  most  convenient  to  him  to  possess  it ;  but 
in  no  wise  the  source  of  the  remuneration  itself. 

§  io.  The  preceding  principles  demonstrate  the  fallacy  of 
many  popular  arguments  and  doctrines,  which  are  continually 
reproducing  themselves  in  new  forms.  For  example,  it  has  been 
contended,  and  by  some  from  whom  better  things  might  have 
been  expected,  that  the  argument  for  the  income  tax,  grounded 
on  its  falling  on  the  higher  and  middle  classes  only,  and  sparing 
the  poor,  is  an  error;  some  have  gone  so  far  as  to  say,  an  im¬ 
posture  ;  because  in  taking  from  the  rich  what  they  would  have 
expended  among  the  poor,  the  tax  injures  the  poor  as  much  as 
if  it  had  been  directly  levied  from  them.  Of  this  doctrine  we 
now  know  what  to  think.  So  far,  indeed,  as  what  is  taken  from 
the  rich  in  taxes,  would,  if  not  so  taken,  have  been  saved  and 
converted  into  capital,  or  even  expended  in  the  maintenance 
and  wages  of  servants  or  of  any  class  of  unproductive  laborers, 
to  that  extent  the  demand  for  labor  is  no  doubt  diminished,  and 
the  poor  injuriously  affected,  by  the  tax  on  the  rich;  and  as 
these  effects  are  almost  always  produced  in  a  greater  or  less 
degree,  it  is  impossible  so  to  tax  the  rich  as  that  no  portion 
whatever  of  the  tax  can  fall  on  the  poor.  But  even  here  the 
question  arises,  whether  the  government,  after  receiving  the 
amount,  will  not  lay  out  as  great  a  portion  of  it  in  the  direct 
purchase  of  labor,  as  the  taxpayers  would  have  done.  In  regard 
to  all  that  portion  of  the  tax,  which,  if  not  paid  to  the  govern¬ 
ment,  would  have  been  consumed  in  the  form  of  commodities 
(or  even  expended  in  services  if  the  payment  has  been  advanced 
by  a  capitalist),  this,  according  to  the  principles  we  have  inves¬ 
tigated,  falls  definitively  on  the  rich,  and  not  at  all  on  the  poor. 
There  is  exactly  the  same  demand  for  labor,  so  far  as  this  por¬ 
tion  is  concerned,  after  the  tax,  as  before  it.  The  capital  which 
hitherto  employed  the  laborers  of  the  country,  remains,  and  is 
still  capable  of  employing  the  same  number.  There  is  the  same 
amount  of  produce  paid  in  wages,  or  allotted  to  defray  the  feed¬ 
ing  and  clothing  of  laborers. 

If  those  against  whom  I  am  now  contending  were  in  the  right, 
it  would  be  impossible  to  tax  anybody  except  the  poor.  If  it 
is  taxing  the  laborers,  to  tax  what  is  laid  out  in  the  produce 


FUNDAMENTAL  PROPOSITIONS  ON  CAPITAL  89 


of  labor,  the  laboring  classes  pay  all  the  taxes.  The  same  argu¬ 
ment,  however,  equally  proves,  that  it  is  impossible  to  tax  the 
laborers  at  all ;  since  the  tax,  being  laid  out  either  in  labor  or 
in  commodities,  comes  all  back  to  them ;  so  that  taxation  has 
the  singular  property  of  falling  on  nobody.  On  the  same  show¬ 
ing,  it  would  do  the  laborers  no  harm  to  take  from  them  all 
they  have,  and  distribute  it  among  the  other  members  of  the 
community.  It  would  all  be  “  spent  among  them,”  which  on 
this  theory  comes  to  the  same  thing.  The  error  is  produced  by 
not  looking  directly  at  the  realities  of  the  phenomena,  but  at¬ 
tending  only  to  the  outward  mechanism  of  paying  and  spend¬ 
ing.  If  we  look  at  the  effects  produced  not  on  the  money,  which 
merely  changes  hands,  but  on  the  commodities  which  are  used 
and  consumed,  we  see  that,  in  consequence  of  the  income  tax, 
the  classes  who  pay  it  do  really  diminish  their  consumption. 
Exactly  so  far  as  they  do  this,  they  are  the  persons  on  whom 
the  tax  falls.  It  is  defrayed  out  of  what  they  would  otherwise 
have  used  and  enjoyed.  So  far,  on  the  other  hand,  as  the 
burden  falls,  not  on  what  they  would  have  consumed,  but  on 
what  they  would  have  saved  to  maintain  production,  or  spent 
in  maintaining  or  paying  unproductive  laborers,  to  that  extent 
the  tax  forms  a  deduction  from  what  would  have  been  used 
and  enjoyed  by  the  laboring  classes.  But  if  the  government, 
as  is  probably  the  fact,  expends  fully  as  much  of  the  amount 
as  the  taxpayers  would  have  done  in  the  direct  employment  of 
labor,  as  in  hiring  sailors,  soldiers,  and  policemen,  or  in  paying 
off  debt,  by  which  last  operation  it  even  increases  capital :  the 
laboring  classes  not  only  do  not  lose  any  employment  by  the 
tax,  but  may  possibly  gain  some,  and  the  whole  of  the  tax  falls 
exclusively  where  it  was  intended. 

All  that  portion  of  the  produce  of  the  country  which  anyone, 
not  a  laborer,  actually  and  literally  consumes  for  his  own  use, 
does  not  contribute  in  the  smallest  degree  to  the  maintenance 
of  labor.  No  one  is  benefited  by  mere  consumption,  except  the 
person  who  consumes.  And  a  person  cannot  both  consume  his 
income  himself,  and  make  it  over  to  be  consumed  by  others. 
Taking  away  a  certain  portion  by  taxation  cannot  deprive  both 
him  and  them  of  it,  but  only  him  or  them.  To  know  which  is 
the  sufferer,  we  must  understand  whose  consumption  will  have 
to  be  retrenched  in  consequence:  this,  whoever  it  be,  is  the 
person  on  whom  the  tax  really  falls. 


9° 


POLITICAL  ECONOMY 


Chapter  VI. — On  Circulating  and  Fixed  Capital 

§  i.  To  complete  our  explanations  on  the  subject  of  capital, 
it  is  necessary  to  say  something  of  the  two  species  into  which 
it  is  usually  divided.  The  distinction  is  very  obvious,  and 
though  not  named,  has  been  often  adverted  to,  in  the  two 
preceding  chapters :  but  it  is  now  proper  to  define  it  accurately, 
and  to  point  out  a  few  of  its  consequences. 

Of  the  capital  engaged  in  the  production  of  any  commodity, 
there  is  a  part  which,  after  being  once  used,  exists  no  longer 
as  capital ;  is  no  longer  capable  of  rendering  service  to  pro- 
duction,  or  at  least  not  the  same  service,  nor  to  the  same  sort 
of  production.  Such,  for  example,  is  the  portion  of  capital 
which  consists  of  materials.  The  tallow  and  alkali  of  which 
soap  is  made,  once  used  in  the  manufacture,  are  destroyed  as 
alkali  and  tallow;  and  cannot  be  employed  any  further  in  the 
soap  manufacture,  though  in  their  altered  condition,  as  soap, 
they  are  capable  of  being  used  as  a  material  or  an  instrument 
in  other  branches  of  manufacture.  In  the  same  division  must 
be  placed  the  portion  of  capital  which  is  paid  as  the  wages, 
or  consumed  as  the  subsistence  of  laborers.  That  part  of  the 
capital  of  a  cotton-spinner  which  he  pays  away  to  his  work¬ 
people,  once  so  paid,  exists  no  longer  as  his  capital,  or  as  a 
cotton-spinner’s  capital :  such  portion  of  it  as  the  workmen 
consume,  no  longer  exists  as  capital  at  all:  even  if  they  save 
any  part,  it  may  now  be  more  properly  regarded  as  a  fresh 
capital,  the  result  of  a  second  act  of  accumulation.  Capital 
which  in  this  manner  fulfils  the  whole  of  its  office  in  the  pro¬ 
duction  in  which  it  is  engaged,  by  a  single  use,  is  called  Circu¬ 
lating  Capital.  The  term,  which  is  not  very  appropriate,  is 
derived  from  the  circumstance,  that  this  portion  of  capital  re¬ 
quires  to  be  constantly  renewed  by  the  sale  of  the  finished 
product,  and  when  renewed  is  perpetually  parted  with  in  buy¬ 
ing  materials  and  paying  wages ;  so  that  it  does  its  work,  not 
by  being  kept,  but  by  changing  hands. 

Another  large  portion  of  capital,  however,  consists  in  instru- 
ments  of  production,  of  a  more  or  less  permanent  character: 
which  produce  ffieir  effect  not  by  being  parted  with,  but  by 
being  kept;  and  the  efficacy  of  which  is  not  exhausted  by  a 
single  use.  To  this  class  belong  buildings,  machinery,  and  all 


CIRCULATING  AND  FIXED  CAPITAL 


9i 


or  most  things  known  by  the  name  of  implements  or  tools. 
The  durability  of  some  of  these  is  considerable,  and  their  func¬ 
tion  as  productive  instruments  is  prolonged  through  many  repe¬ 
titions  of  the  productive  operation.  In  this  class  must  likewise 
be  included  capital  sunk  (as  the  expression  is)  in  permanent 
improvements  of  land.  So  also  the  capital  expended  once  for 
all,  in  the  commencement  of  an  undertaking,  to  prepare  the 
way  for  subsequent  operations :  the  expense  of  opening  a  mine, 
for  example:  of  cutting  canals,  of  making  roads  or  docks. 
Other  examples  might  be  added,  but  these  are  sufficient.  Capi¬ 
tal  which  exists  in  any  of  these  durable  shapes,  and  the  return 
to  which  is  spread  over  a  period  of  corresponding  duration, 
is  called  Fixed  Capital. 

Of  fixed  capitals,  some  kinds  require  to  be  occasionally  or 
periodically  renewed.  Such  are  all  implements  and  buildings: 
they  require,  at  intervals,  partial  renewal  by  means  of  repairs, 
and  are  at  last  entirely  worn  out,  and  cannot  be  of  any  further 
service  as  buildings  and  implements,  but  fall  back  into  the  class 
of  materials.  In  other  cases,  the  capital  does  not,  unless  as  a 
consequence  of  some  unusual  accident,  require  entire  renewal : 
but  there  is  always  some  outlay  needed,  either  regularly  or  at 
least  occasionally,  to  keep  it  up.  A  dock  or  a  cana^  once  made, 
does  not  require,  like  a  machine,  to  be  made  again,  unless  pur¬ 
posely  destroyed,  or  unless  an  earthquake  or  some  similar 
catastrophe  has  filled  it  up:  but  regular  and  frequent  outlays 
are  necessary  to  keep  it  in  repair.  The  cost  of  opening  a  mine 
needs  not  be  incurred  a  second  time ;  but  unless  someone  goes 
to  the  expense  of  keeping  the  mine  clear  of  water,  it  is  soon 
rendered  useless.  The  most  permanent  of  all  kinds  of  fixed 
capital  is  that  employed  in  giving  increased  productiveness  to 
a  natural  agent,  such  as  land.  The  draining  of  marshy  or  inun¬ 
dated  tracts  like  the  Bedford  Level,  the  reclaiming  of  land 
from  the  sea,  or  its  protection  by  embankments,  are  improve¬ 
ments  calculated  for  perpetuity ;  but  drains  and  dikes  require 
frequent  repair.  The  same  character  of  perpetuity  belongs  to 
the  improvement  of  land  by  subsoil  draining,  which  adds  so 
much  to  the  productiveness  of  the  clay  soils ;  or  by  permanent 
manures,  that  is,  by  the  addition  to  the  soil,  not  of  the  sub¬ 
stances  which  enter  into  the  composition  of  vegetables,  and 
which  are  therefore  consumed  by  vegetation,  but  of  those  which 
merely  alter  the  relation  of  the  soil  to  air  and  water;  as  sand 


92 


POLITICAL  ECONOMY 


and  lime  on  the  heavy  soils,  clay  and  marl  on  the  light.  Even 
such  works,  however,  require  some,  though  it  may  be  very 
little,  occasional  outlay  to  maintain  their  full  effect. 

These  improvements,  however,  by  the  very  fact  of  their  de¬ 
serving  that  title,  produce  an  increase  of  return,  which,  after 
defraying  all  expenditure  necessary  for  keeping  them  up,  still 
leaves  a  surplus.  This  surplus  forms  the  return  to  the  capital 
sunk  in  the  first  instance,  and  that  return  does  not,  as  in  the 
case  of  machinery,  terminate  by  the  wearing  out  of  the  ma¬ 
chine,  but  continues  forever.  The  land  thus  increased  in  pro¬ 
ductiveness,  bears  a  value  in  the  market,  proportional  to  the 
increase:  and  hence  it  is  usual  to  consider  the  capital  which 
was  invested,  or  sunk,  in  making  the  improvement,  as  still  exist¬ 
ing  in  the  increased  value  of  the  land.  There  must  be  no 
mistake,  however.  The  capital,  like  all  other  capital,  has  been 
consumed.  It  was  consumed  in  maintaining  the  laborers  who 
executed  the  improvement,  and  in  the  wear  and  tear  of  the 
tools  by  which  they  were  assisted.  But  it  was  consumed  pro¬ 
ductively,  and  has  left  a  permanent  result  in  the  improved 
productiveness  of  an  appropriated  natural  agent,  the  land.  We 
may  call  the  increased  produce  the  joint  result  of  the  land  and 
of  a  capital  fixed  in  the  land.  But  as  the  capital,  having  in 
reality  been  consumed,  cannot  be  withdrawn,  its  productiveness 
is  thenceforth  indissolubly  blended  with  that  arising  from  the 
original  qualities  of  the  soil ;  and  the  remuneration  for  the  use 
of  it  thenceforth  depends,  not  upon  the  laws  which  govern  the 
returns  to  labor  and  capital,  but  upon  those  which  govern  the 
recompense  for  natural  agents.  What  these  are,  we  shall  see 
hereafter.* 

§  2.  There  is  a  great  difference  between  the  effects  of  circu¬ 
lating  and  those  of  fixed  capital,  on  the  amount  of  the  gross 
produce  of  the  country.  Circulating  capital  being  destroyed 
as  such,  or  at  any  rate  finally  lost  to  the  owner,  by  a  single  use ; 
and  the  product  resulting  from  that  one  use  being  the  only 
source  from  which  the  owner  can  replace  the  capital,  or  obtain 
any  remuneration  for  its  productive  employment;  the  product 
must  of  course  be  sufficient  for  those  purposes,  or  in  other 
words,  the  result  of  a  single  use  must  be  a  reproduction  equal 
to  the  whole  amount  of  the  circulating  capital  used,  and  a  profit 
besides.  This,  however,  is  by  no  means  necessary  in  the  case 

*  Infra,  book  ii.  chap.  xvi.  On  Rent. 


CIRCULATING  AND  FIXED  CAPITAL 


93 


of  fixed  capital.  Since  machinery,  for  example,  is  not  wholly 
consumed  by  one  use,  it  is  not  necessary  that  it  should  be  wholly 
replaced  from  the  product  of  that  use.  The  machine  answers 
the  purpose  of  its  owner,  if  it  brings  in,  during  each  interval 
of  time,  enough  to  cover  the  expense  of  repairs,  and  the  de¬ 
terioration  in  value  which  the  machine  has  sustained  during 
the  same  time,  with  a  surplus  sufficient  to  yield  the  ordinary 
profit  on  the  entire  value  of  the  machine. 

From  this  it  follows  that  all  increase  of  fixed  capital,  when 
taking  place  at  the  expense  of  circulating,  must  be,  at  least 
temporarily,  prejudicial  to  the  interests  of  the  laborers^  This 
is  true,  not  of  machinery  alone,  but  of  all  improvements  by 
which  capital  is  sunk ;  that  is,  rendered  permanently  incapable 
of  being  applied  to  the  maintenance  and  remuneration  of  labor. 
Suppose  that  a  person  farms  his  own  land,  with  a  capital  of  two 
thousand  quarters  of  corn,  employed  in  maintaining  laborers 
during  one  year  (for  simplicity  we  omit  the  consideration  of 
seed  and  tools),  whose  labor  produces  him  annually  two  thou¬ 
sand  four  hundred  quarters,  being  a  profit  of  twenty  per  cent. 
This  profit  we  shall  suppose  that  he  annually  consumes,  carry¬ 
ing  on  his  operations  from  year  to  year  on  the  original  capital 
of  two  thousand  quarters.  Let  us  now  suppose  that  by  the 
expenditure  of  half  his  capital  he  effects  a  permanent  improve¬ 
ment  of  his  land,  which  is  executed  by  half  his  laborers,  and 
occupies  them  for  a  year,  after  which  he  will  only  require,  for 
the  effectual  cultivation  of  his  land,  half  as  many  laborers  as 
before.  The  remainder  of  his  capital  he  employs  as  usual.  In 
the  first  year  there  is  no  difference  in  the  condition  of  the  la¬ 
borers,  except  that  part  of  them  have  received  the  same  pay 
for  an  operation  on  the  land,  which  they  previously  obtained 
for  ploughing,  sowing,  and  reaping.  At  the  end  of  the  year, 
however,  the  improver  has  not,  as  before,  a  capital  of  two  thou¬ 
sand  quarters  of  corn.  Only  one  thousand  quarters  of  his  capi¬ 
tal  have  been  reproduced  in  the  usual  way:  he  has  now  only 
those  thousand  quarters  and  his  improvements.  He  will  em¬ 
ploy,  in  the  next  and  in  each  following  year,  only  half  the  num¬ 
ber  of  laborers,  and  will  divide  among  them  only  half  the  former 
quantity  of  subsistence.  The  loss  will  soon  be  made  up  to  them 
if  the  improved  land,  with  the  diminished  quantity  of  labor, 
produces  two  thousand  four  hundred  quarters  as  before,  be¬ 
cause  so  enormous  an  accession  of  gain  will  probably  induce 


94 


POLITICAL  ECONOMY 


the  improver  to  save  a  part,  add  it  to  his  capital,  and  become 
a  larger  employer  of  labor.  But  it  is  conceivable  that  this  may 
not  be  the  case;  for  (supposing,  as  we  may  do,  that  the  im¬ 
provement  will  last  indefinitely,  without  any  outlay  worth  men¬ 
tioning  to  keep  it  up)  the  improver  will  have  gained  largely 
by  his  improvement  if  the  land  now  yields,  not  two  thousand 
four  hundred,  but  one  thousand  five  hundred  quarters;  since 
this  will  replace  the  one  thousand  quarters  forming  his  present 
circulating  capital,  with  a  profit  of  twenty-five  per  cent,  (instead 
of  twenty  as  before)  on  the  whole  capital,  fixed  and  circulating 
together.  The  improvement,  therefore,  may  be  a  very  profit¬ 
able  one  to  him,  and  yet  very  injurious  to  the  laborers. 

The  supposition,  in  the  terms  in  which  it  has  been  stated,  is 
purely  ideal ;  or  at  most  applicable  only  to  such  a  case  as  that 
of  the  conversion  of  arable  land  into  pasture,  which,  though 
formerly  a  frequent  practice,  is  regarded  by  modern  agricult¬ 
urists  as  the  reverse  of  an  improvement.  The  clearing  away 
of  the  small  farmers  in  the  north  of  Scotland,  within  the  present 
century,  was  however  a  case  of  it ;  and  Ireland,  since  the  potato 
famine  and  the  repeal  of  the  corn-laws,  is  another.  The  re¬ 
markable  decrease  which  has  lately  attracted  notice  in  the  gross 
produce  of  Irish  agriculture,  is,  to  all  appearance,  partly  attrib¬ 
utable  to  the  diversion  of  land  from  maintaining  human  laborers 
to  feeding  cattle :  and  it  could  not  have  taken  place  without  the 
removal  of  a  large  part  of  the  Irish  population  by  emigration 
or  death.  We  have  thus  two  recent  instances  in  which  what 
was  regarded  as  an  agricultural  improvement,  has  diminished 
the  power  of  the  country  to  support  its  population.  The  effect, 
however,  of  all  the  improvements  due  to  modern  science  is  to 
increase,  or  at  all  events,  not  to  diminish  the  gross  produce. 
But  this  does  not  affect  the  substance  of  the  argument.  Sup¬ 
pose  that  the  improvement  does  not  operate  in  the  manner  sup¬ 
posed — does  not  enable  a  part  of  the  labor  previously  employed 
on  the  land  to  be  dispensed  with — but  only  enables  the  same 
labor  to  raise  a  greater  produce.  Suppose,  too,  that  the  greater 
produce,  which  by  means  of  the  improvement  can  be  raised  from 
the  soil  with  the  same  labor,  is  all  wanted,  and  will  find  purchas¬ 
ers.  The  improver  will  in  that  case  require  the  same  number  of 
laborers  as  before,  at  the  same  wages.  But  where  will  he  find 
the  means  of  paying  them?  He  has  no  longer  his  original  cap¬ 
ital  of  two  thousand  quarters  disposable  for  the  purpose.  One 


CIRCULATING  AND  FIXED  CAPITAL 


95 


thousand  of  them  are  lost  and  gone — consumed  in  making  the 
improvement.  If  he  is  to  employ  as  many  laborers  as  before, 
and  pay  them  as  highly,  he  must  borrow,  or  obtain  from  some 
other  source,  a  thousand  quarters  to  supply  the  deficit.  But 
these  thousand  quarters  already  maintained,  or  were  destined 
to  maintain,  an  equivalent  quantity  of  labor.  They  are  not  a 
fresh  creation ;  their  destination  is  only  changed  from  one 
productive  employment  to  another ;  and  though  the  agricultur¬ 
ist  has  made  up  the  deficiency  in  his  own  circulating  capital, 
the  breach  in  the  circulating  capital  of  the  community  remains 
unrepaired. 

The  argument  relied  on  by  most  of  those  who  contend  that 
machinery  can  never  be  injurious  to  the  laboring  class,  is, 
that  by  cheapening  production  it  creates  such  an  increased  de¬ 
mand  for  the  commodity,  as  enables,  ere  long,  a  greater  number 
of  persons  than  ever  to  find  employment  in  producing  it.  This 
argument  does  not  seem  to  me  to  have  the  weight  commonly 
ascribed  to  it.  The  fact,  though  too  broadly  stated,  is,  no  doubt, 
often  true.  The  copyists  who  were  thrown  out  of  employment 
by  the  invention  of  printing,  were  doubtless  soon  outnumbered 
by  the  compositors  and  pressmen  who  took  their  place:  and 
the  number  of  laboring  persons  now  occupied  in  the  cotton  man¬ 
ufacture  is  many  times  greater  than  were  so  occupied  previously 
to  the  inventions  of  Hargreaves  and  Arkwright,  which  shows 
that  besides  the  enormous  fixed  capital  now  embarked  in  the 
manufacture,  it  also  employs  a  far  larger  circulating  capital 
than  at  any  former  time.  But  if  this  capital  was  drawn  from 
other  employments ;  if  the  funds  which  took  the  place  of  the 
capital  sunk  in  costly  machinery,  were  supplied  not  by  any 
additional  saving  consequent  on  the  improvements,  but  by  drafts 
on  the  general  capital  of  the  community ;  what  better  are  the 
laboring  classes  for  the  mere  transfer?  In  what  manner  is 
the  loss  they  sustained  by  the  conversion  of  circulating  into 
fixed  capital,  made  up  to  them  by  a  mere  shifting  of  part  of 
the  remainder  of  the  circulating  capital  from  its  old  employ¬ 
ments  to  a  new  one? 

All  attempts  to  make  out  that  the  laboring  classes  as  a  collec¬ 
tive  body  cannot  suffer  temporarily  by  the  introduction  of  ma¬ 
chinery,  or  by  the  sinking  of  capital  in  permanent  improve¬ 
ments,  are,  I  conceive,  necessarily  fallacious.  That  they  would 
suffer  in  the  particular  department  of  industry  to  which  the 


96 


POLITICAL  ECONOMY 


change  applies,  is  generally  admitted,  and  obvious  to  common 
sense;  but  it  is  often  said,  that  though  employment  is  with¬ 
drawn  from  labor  in  one  department,  an  exactly  equivalent 
employment  is  opened  for  it  in  others,  because  what  the  con¬ 
sumers  save  in  the  increased  cheapness  of  one  particular  article 
enables  them  to  augment  their  consumption  of  others,  thereby 
increasing  the  demand  for  other  kinds  of  labor.  This  is  plau¬ 
sible,  but,  as  was  shown  in  the  last  chapter,  involves  a  fallacy ; 
demand  for  commodities  being  a  totally  different  thing  from 
demand  for  labor.  It  is  true,  the  consumers  have  now  addi¬ 
tional  means  of  buying  other  things;  but  this  will  not  create 
the  other  things,  unless  there  is  capital  to  produce  them,  and 
the  improvement  has  not  set  at  liberty  any  capital,  if  even  it  has 
not  absorbed  some  from  other  employments.  The  supposed 
increase  of  production  and  of  employment  for  labor  in  other 
departments  therefore  will  not  take  place;  and  the  increased 
demand  for  commodities  by  some  consumers,  will  be  balanced 
by  a  cessation  of  demand  on  the  part  of  others,  namely,  the  la¬ 
borers  who  were  superseded  by  the  improvement,  and  who  will 
now  be  maintained,  if  at  all,  by  sharing,  either  in  the  way  of 
competition,  or  of  charity,  in  what  was  previously  consumed  by 
other  people. 

§  3.  .Nevertheless,  I  do  not  believe  that  as  things  are  actually 
transacted,  improvements  in  production  are  often,  if  ever,  in¬ 

jurious,  even  temporarily,  to  the  laboring  classes  in  the  aggre¬ 
gate.  They  would  be  so  if  they  took  place  suddenly  to  a  great 
amount,  because  much  of  the  capital  sunk  must  necessarily  in 

that  case  be  provided  from  funds  already  employed  as  circulat¬ 
ing  capital..  But  improvements  are  always  introduced  very 
gradually,  and- are  seldonTor  never  made  by  ^withdrawing  cir- 
culating'Ta^tal  Trom  actuanproducffonT^but  are  made  by  the 
employment  oTlhe  ciiiiiuaTincreasel  There  are  few,  if  any,  ex¬ 
amples  of  a  greaFTncreasFoT^xeci  capital,  at  a  time  and  place 
where  circulating  capital  was  not  rapidly  increasing  likewise. 
It  is  not  in  poor  or  backward  countries  that  great  and  costly 
improvements  in  production  are  made.  To  sink  capital  in  land 
for  a  permanent  return — to  introduce  expensive  machinery — 
are  acts  involving  immediate  sacrifice  for  distant  objects;  and 
indicate,  in  the  first  place,  tolerably  complete  security  of  prop¬ 
erty  ;  in  the  second,  considerable  activity  of  industrial  enter¬ 
prise  ;  and  in  the  third,  a  high  standard  of  what  has  been  called 


CIRCULATING  AND  FIXED  CAPITAL 


97 


the  “  effective  desire  of  accumulation  ” :  which  three  things 
are  the  elements  of  a  society  rapidly  progressive  in  its  amount 
of  capital.  Although,  therefore,  the  laboring  classes  must  suf¬ 
fer,  not  only  if  the  increase  of  fixed  capital  takes  place  at  the 
expense  of  circulating,  but  even  if  it  is  so  large  and  rapid  as 
to  retard  that  ordinary  increase  to  which  the  growth  of  popula¬ 
tion  has  habitually  adapted  itself ;  yet,  in  point  of  fact,  this  is 
very  unlikely  to  happen,  since  there  is  probably  no  country 
whose  fixed  capital  increases  in  a  ratio  more  than  proportional 
to  its  circulating.  If  the  whole  of  the  railways  which,  during 
the  speculative  madness  of  1845,  obtained  the  sanction  of  Par¬ 
liament,  had  been  constructed  in  the  times  fixed  for  the  com¬ 
pletion  of  each,  this  improbable  contingency  would,  most  likely, 
have  been  realized ;  but  this  very  case  has  afforded  a  striking 
example  of  the  difficulties  which  oppose  the  diversion  into  new 
channels  of  any  considerable  portion  of  the  capital  that  supplies 
the  old :  difficulties  generally  much  more  than  sufficient  to  pre¬ 
vent  enterprises  that  involve  the  sinking  of  capital,  from  ex¬ 
tending  themselves  with  such  rapidity  as  to  impair  the  sources 
of  the  existing  employment  for  labor. 

To  these  considerations  must  be  added,  that  even  if  improve¬ 
ments  did  for  a  time  decrease  the  aggregate  produce  and  the 
circulating  capital  of  the  community,  they  would  not  the  less 
tend  in  the  long  run  to  augment  both.  They  increase  the  return 
to  capital ;  and  of  this  increase  the  benefit  must  necessarily 
accrue  either  to  the  capitalist  in  greater  profits,  or  to  the  cus¬ 
tomer  in  diminished  prices ;  affording,  in  either  case,  an  aug¬ 
mented  fund  from  which  accumulation  may  be  made,  while 
enlarged  profits  also  hold  out  an  increased  inducement  to  ac¬ 
cumulation.  In  the  case  we  before  selected,  in  which  the  im¬ 
mediate  result  of  the  improvement  was  to  diminish  the  gross 
produce  from  two  thousand  four  hundred  quarters  to  one  thou¬ 
sand  five  hundred,  yet  the  profit  of  the  capitalist  being  now  five 
hundred  quarters  instead  of  four  hundred,  the  extra  one  hun¬ 
dred  quarters,  if  regularly  saved,  would  in  a  few  years  replace 
the  one  thousand  quarters  subtracted  from  his  circulating  capi¬ 
tal.  Now  the  extension  of  business  which  almost  certainly  fol¬ 
lows  in  any  department  in  which  an  improvement  has  been 
made,  affords  a  strong  inducement  to  those  engaged  in  it  to 
add  to  their  capital ;  and  hence,  at  the  slow  pace  at  which 
improvements  are  usually  introduced,  a  great  part  of  the  capital 
Vol.  I.— 7 


98 


POLITICAL  ECONOMY 


which  the  improvement  ultimately  absorbs,  is  drawn  from  the 
increased  profits  and  increased  savings  which  it  has  itself  called 
forth. 

This  tendency  of  improvements  in  production  to  cause  in¬ 
creased  accumulation,  and  thereby  ultimately  to  increase  the 
gross  produce,  even  if  temporarily  diminishing  it,  will  assume 
a  still  more  decided  character  if  it  should  appear  that  there  are 
assignable  limits  both  to  the  accumulation  of  capital,  and  to 
the  increase  of  production  from  the  land,  which  limits  once 
attained,  all  further  increase  of  produce  must  stop ;  but  that 
improvements  in  production,  whatever  may  be  their  other  ef¬ 
fects,  tend  to  throw  one  or  both  of  these  limits  farther  off. 
Now,  these  are  truths  which  will  appear  in  the  clearest  light 
in  a  subsequent  stage  of  our  investigation.  It  will  be  seen,  that 
the  quantity  of  capital  which  will,  or  even  which  can,  be  accu¬ 
mulated  in  any  country,  and  the  amount  of  gross  produce  which 
will,  or  even  which  can,  be  raised,  bear  a  proportion  to  the  state 
of  the  arts  of  production  there  existing;  and  that  every  im¬ 
provement,  even  if  for  the  time  it  diminish  the  circulating  capi¬ 
tal  and  the  gross  produce,  ultimately  makes  room  for  a  larger 
amount  of  both,  than  could  possibly  have  existed  otherwise.  It 
is  this  which  is  the  conclusive  answer  to  the  objections  against 
machinery ;  and  the  proof  thence  arising  of  the  ultimate  benefit 
to  laborers  of  mechanical  inventions  even  in  the  existing  state 
of  society,  will  hereafter  be  seen  to  be  conclusive.*  But  this 
does  not  discharge  governments  from  the  obligation  of  alleviat¬ 
ing,  and  if  possible  preventing,  the  evils  of  which  this  source  of 
ultimate  benefit  is  or  may  be  productive  to  an  existing  genera¬ 
tion.  If  the  sinking  or  fixing  of  capital  in  machinery  or  useful 
works,  were  ever  to  proceed  at  such  a  pace  as  to  impair  mate¬ 
rially  the  funds  for  the  maintenance  of  labor,  it  would  be  in¬ 
cumbent  on  legislators  to  take  measures  for  moderating  its 
rapidity:  and  since  improvements  which  do  not  diminish  em¬ 
ployment  on  the  whole,  almost  always  throw  some  particular 
class  of  laborers  out  of  it,  there  cannot  be  a  more  legitimate 
object  of  the  legislator’s  care  than  the  interests  of  those  who 
are  thus  sacrificed  to  the  gains  of  their  fellow-citizens  and  of 
posterity. 

To  return  to  the  theoretical  distinction  between  fixed  and 
circulating  capital.  Since  all  wealth  which  is  destined  to  be 

*  Infra,  book  iv.  chap.  v. 


■ 


- 

,  ,  „  •  •  x 


W.:i  ']  iM':T q  .U..-S  'j::  D  !•> 


. 


in.  -*  u  t  .vwV  Vt  ••  ,*U  ’  '  U  • 

-  . 

,  .  , . • : .v  "  >  U  ■  >-  S  '  1  !**!  ■  5  ’  ' 


.  >  <  »  i:  •  '  v>-  •  i 


* 


, 


•  • 


CHOICE  EXAMPLES  OF  CLASSIC  SCULPTURE. 


HERMES. 


From  the  original  bronze  statue  in  the  Museo  Borbonico  at  Naples. 

Hermes,  called  Mercurus  by  the  Romans,  was  a  son  of  Zeus  (Jupiter)  and 
Maia,  the  daughter  of  Atlas.  In  Mythology  he  is  the  god  of  trade  and  the  mes¬ 
senger  of  Olympus.  He  is  frequently  represented  with  a  winged  cap,  wings  on 
both  feet,  and  a  short  staff,  winged  and  entwined  with  serpents. 


CIRCULATING  AND  FIXED  CAPITAL 


99 


employed  for  reproduction  comes  within  the  designation  of  cap¬ 
ital,  there  are  parts  of  capital  which  do  not  agree  with  the  defi¬ 
nition  of  either  species  of  it ;  for  instance,  the  stock  of  finished 
goods  which  a  manufacturer  or  dealer  at  any  times  possesses 
unsold  in  his  warehouses.  But  this,  though  capital  as  to  its 
destination,  is  not  yet  capital  in  actual  exercise:  it  is  not  en¬ 
gaged  in  production,  but  has  first  to  be  sold  or  exchanged,  that 
is,  converted  into  an  equivalent  value  of  some  other  commod¬ 
ities  ;  and  therefore  is  not  yet  either  fixed  or  circulating  capital ; 
but  will  become  either  one  or  the  other,  or  be  eventually  divided 
between  them.  With  the  proceeds  of  his  finished  goods,  a  manu¬ 
facturer  will  partly  pay  his  work-people,  partly  replenish  his 
stock  of  the  materials  of  his  manufacture,  and  partly  provide 
new  buildings  and  machinery,  or  repair  the  old ;  but  how  much 
will  be  devoted  to  one  purpose,  and  how  much  to  another,  de¬ 
pends  on  the  nature  of  the  manufacture,  and  the  requirements 
of  the  particular  moment. 

It  should  be  observed  further,  that  the  portion  of  capital  con¬ 
sumed  in  the  form  of  seed  or  material,  though,  unlike  fixed 
capital,  it  requires  to  be  at  once  replaced  from  the  gross  produce, 
stands  yet  in  the  same  relation  to  the  employment  of  labor  as 
fixed  capital  does.  What  is  expended  in  materials  is  as  much 
withdrawn  from  the  maintenance  and  remuneration  of  laborers, 
as  what  is  fixed  in  machinery;  and  if  capital  now  expended  in 
wages  were  diverted  to  the  providing  of  materials,  the  effect 
on  the  laborers  would  be  as  prejudicial  as  if  it  were  converted 
into  fixed  capital.  This,  however,  is  a  kind  of  change  which 
never  takes  place.  The  tendency  of  improvements  in  production 
is  always  to  economize,  never  to  increase,  the  expenditure  of 
seed  or  material  for  a  given  produce ;  and  the  interest  of  the 
laborers  has  no  detriment  to  apprehend  from  this  source. 

Chapter  VII. — On  what  Depends  the  Degree  of  Productiveness 

of  Productive  Agents 

§  i.  We  have  concluded  our  general  survey  of  the  requisites 
of  production.  We  have  found  that  they  may  be  reduced  to 
three :  labor,  capital,  and  the  materials  and  motive  forces  af¬ 
forded  by  nature.  Of  these,  labor  and  the  raw  material  of  the 
globe  are  primary  and  indispensable.  Natural  motive  powers 
may  be  called  in  to  the  assistance  of  labor,  and  are  a  help,  but 


IOO 


POLITICAL  ECONOMY 


not  an  essential,  of  production.  The  remaining  requisite,  capi¬ 
tal,  is  itself  the  product  of  labor:  its  instrumentality  in  produc¬ 
tion  is  therefore,  in  reality,  that  of  labor  in  an  indirect  shape. 
It  does  not  the  less  require  to  be  specified  separately.  A  pre¬ 
vious  application  of  labor  to  produce  the  capital  required  for 
consumption  during  the  work,  is  no  less  essential  than  the  ap¬ 
plication  of  labor  to  the  work  itself.  Of  capital,  again,  one, 
and  by  far  the  largest,  portion,  conduces  to  production  only  by 
sustaining  in  existence  the  labor  which  produces :  the  remain¬ 
der,  namely  the  instruments  and  materials,  contribute  to  it  di¬ 
rectly,  in  the  same  manner  with  natural  agents,  and  the  mate¬ 
rials  supplied  by  nature. 

We  now  advance  to  the  second  great  question  in  political 
economy ;  on  what  the  degree  of  productiveness  of  these  agents 
depends.  For  it  is  evident  that  their  productive  efficacy  varies 
greatly  at  various  times  and  places.  With  the  same  population 
and  extent  of  territory,  some  countries  have  a  much  larger 
amount  of  production  than  others,  and  the  same  country  at 
one  time  a  greater  amount  than  itself  at  another.  Compare 
England  either  with  a  similar  extent  of  territory  in  Russia,  or 
with  an  equal  population  of  Russians.  Compare  England  now 
with  England  in  the  Middle  Ages ;  Sicily,  Northern  Africa,  or 
Syria  at  present,  with  the  same  countries  at  the  time  of  their 
greatest  prosperity,  before  the  Roman  conquest.  Some  of  the 
causes  which  contribute  to  this  difference  of  productiveness  are 
obvious;  others  not  so  much  so.  We  proceed  to  specify  several 
of  them. 

§  2.  The  most  evident  cause  of  superior  productiveness  is 
what  are  called  patural  advantages.  These  are  various.  JEec- 
tilitv  of^soil  is  one  of  the  principal.  In  this  there  are  great 
varieties,  from  the  deserts  of  Arabia  to  the  alluvial  plains  of 
the  Ganges,  the  Niger,  and  the  Mississippi.  A  favorable  cli¬ 
mate  is  even  more  important  than  a  rich  soil.  There  are  coun¬ 
tries  capable  of  being  inhabited,  but  too  cold  to  be  compatible 
with  agriculture.  Their  inhabitants  cannot  pass  beyond  the 
nomadic  state ;  they  must  live,  like  the  Laplanders,  by  the  do¬ 
mestication  of  the  reindeer,  if  not  by  hunting  or  fishing,  like 
the  miserable  Esquimaux.  There  are  countries  where  oats 
will  ripen,  but  not  wheat,  such  as  the  North  of  Scotland ;  others 
where  wheat  can  be  grown,  but  from  excess  of  moisture  and 
want  of  sunshine,  affords  but  a  precarious  crop;  as  in  parts 


DEGREES  OF  PRODUCTIVENESS 


IOI 


of  Ireland.  With  each  advance  toward  the  south,  or,  in  the 
European  temperate  region,  toward  the  east,  some  new  branch 
of  agriculture  becomes  first  possible,  then  advantageous;  the 
vine,  maize,  figs,  olives,  silk,  rice,  dates,  successively  present 
themselves,  until  we  come  to  the  sugar,  coffee,  cotton,  spices, 
etc.,  of  climates  which  also  afford,  of  the  more  common  agri¬ 
cultural  products,  and  with  only  a  slight  degree  of  cultivation, 
two  or  even  three  harvests  in  a  year.  Nor  is  it  in  agriculture 
alone  that  differences  of  climate  are  important.  Their  influence 
is  felt  in  many  other  branches  of  production :  in  the  durability 
of  all  work  which  is  exposed  to  the  air;  of  buildings,  for  ex¬ 
ample.  If  the  temples  of  Karnac  and  Luxor  had  not  been  in¬ 
jured  by  men,  they  might  have  subsisted  in  their  original  perfec¬ 
tion  almost  forever,  for  the  inscriptions  on  some  of  them, 
though  anterior  to  all  authentic  history,  are  fresher  than  is  in 
our  climate  an  inscription  fifty  years  old :  while  at  St.  Peters¬ 
burg,  the  most  massive  works,  solidly  executed  in  granite  hardly 
a  generation  ago,  are  already,  as  travellers  tell  us,  almost  in  a 
state  to  require  reconstruction,  from  alternate  exposure  to  sum¬ 
mer  heat  and  intense  frost.  The  superiority  of  the  woven 
fabrics  of  Southern  Europe  over  those  of  England  in  the  rich¬ 
ness  and  clearness  of  many  of  their  colors,  is  ascribed  to  the 
superior  quality  of  the  atmosphere,  for  which  neither  the  knowl¬ 
edge  of  chemists  nor  the  skill  of  dyers  has  been  able  to  provide, 
in  our  hazy  and  damp  climate,  a  complete  equivalent. 

Another  part  of  the  influence  of  climate  consists  in  lessening 
the  physical  requirements  of  the  producers.  InTiot  regions, 
mankind  can  exist  in  comfort  with  less  perfect  housing,  less 
clothing;  fuel,  that  absolute  necessary  of  life  in  cold  climates, 
they  can  almost  dispense  with,  except  for  industrial  uses.  They 
also  require  less  aliment ;  as  experience  has  proved,  long  before 
theory  had  accounted  for  it  by  ascertaining  that  most  of  what 
we  consume  as  food  is  not  required  for  the  actual  nutrition  of 
the  organs,  but  for  keeping  up  the  animal  heat,  and  for  supply¬ 
ing  the  necessary  stimulus  to  the  vital  functions,  which  in  hot 
climates  is  almost  sufficiently  supplied  by  air  and  sunshine. 
Much,  therefore,  of  the  labor  elsewhere  expended  to  procure 
the  mere  necessaries  of  life,  not  being  required,  more  remains 
disposable  for  its  higher  uses  and  enjoyments ;  if  the  character 
of  the  inhabitants  does  not  rather  induce  them  to  use  up  these 
advantages  in  over-population,  or  in  the  indulgence  of  repose. 


102 


POLITICAL  ECONOMY 


Among  natural  advantages,  besides  soil  and  climate,  must 
be  mentioned  abundance  of  mineral  productions,  in  convenient 
situations,  and  capable  of  being  worked  with  moderate  labor. 
Such  are  the  coal-fields  of  Great  Britain  which  do  so  much  to 
compensate  its  inhabitants  for  the  disadvantages  of  climate ; 
and  the  scarcely  inferior  resource  possessed  by  this  country  and 
the  United  States,  in  a  copious  supply  of  an  easily  reduced  iron 
ore,  at  no  great  depth  below  the  earth’s  surface,  and  in  close 
proximity  to  coal  deposits  available  for  working  it.  In  moun¬ 
tain  and  hill  districts,  the  abundance  of  natural  water-power 
makes  considerable  amends  for  the  usually  inferior  fertility  of 
those  regions.  But  perhaps  a  greater  advantage  than  all  these 
is  a  maritime  situation,  especially  when  accompanied  with  good 
natural  harbors ;  and,  next  to  it,  great  navigable  rivers.  These 
advantages  consist  indeed  wholly  in  saving  the  cost  of  carriage. 
But  few  who  have  not  considered  the  subject,  have  any  adequate 
notion  how  great  an  extent  of  economical  advantage  this  com¬ 
prises  ;  nor,  without  having  considered  the  influence  exercised 
on  production  by  exchanges,  and  by  what  is  called  the  division 
of  labor,  can  it  be  fully  estimated.  So  important  is  it,  that  it 
often  does  more  than  counterbalance  sterility  of  soil,  and  almost 
every  other  natural  inferiority;  especially  in  that  early  stage 
of  industry  in  which  labor  and  science  have  not  yet  provided 
artificial  means  of  communication  capable  of  rivalling  the  nat¬ 
ural.  In  the  ancient  world,  and  in  the  Middle  Ages,  the  most 
prosperous  communities  were  not  those  which  had  the  largest 
territory,  or  the  most  fertile  soil,  but  rather  those  which  had 
been  forced  by  natural  sterility  to  make  the  utmost  use  of  a 
convenient  maritime  situation;  as  Athens,  Tyre,  Marseilles, 
Venice,  the  free  cities  on  the  Baltic,  and  the  like. 

§  3.  So  much  for  natural  advantages ;  the  value  of  which, 
cceteris  paribus ,  is  too  obvious  to  be  ever  underrated.  But  ex¬ 
perience  testifies  that  natural  advantages  scarcely  ever  do  for 
a  community,  no  more  than  fortune  and  station  do  for  an  in¬ 
dividual,  anything  like  what  it  lies  in  their  nature,  or  in  their 
capacity,  to  do.  Neither  now  nor  in  former  ages  have  the 
nations  possessing  the  best  climate  and  soil  been  either  the  rich¬ 
est  or  the  most  powerful;  but  (in  so  far  as  regards  the  mass 
of  the  people)  generally  among  the  poorest,  though,  in  the  midst 
of  poverty,  probably  on  the  whole  the  most  enjoying.  Human 
life  in  those  countries  can  be  supported  on  so  little,  that  the  poor 


DEGREES  OF  PRODUCTIVENESS 


103 


seldom  suffer  from  anxiety,  and  in  climates  in  which  mere 
existence  is  a  pleasure,  the  luxury  which  they  prefer  is  that  of 
repose.  Energy,  at  the  call  of  passion,  they  possess  in  abun¬ 
dance,  but  not  that  which  is  manifested  in  sustained  and  per¬ 
severing  labor :  and  as  they  seldom  concern  themselves  enough 
about  remote  objects  to  establish  good  political  institutions,  the 
incentives  to  industry  are  further  weakened  by  imperfect  pro¬ 
tection  of  its  fruits.  Successful  production,  like  most  other 
kinds  of  success,  depends  more  on  the  qualities  of  the  human 
agents,  than  on  the  circumstances  in  which  they  work :  and 
it  is  difficulties,  not  facilities,  that  nourish  bodily  and  mental 
energy.  Accordingly  the  tribes  of  mankind  who  have  overrun 
and  conquered  others,  and  compelled  them  to  labor  for  their 
benefit,  have  been  mostly  reared  amidst  hardship.  They  have 
either  been  bred  in  the  forests  of  northern  climates,  or  the  defi¬ 
ciency  of  natural  hardships  has  been  supplied,  as  among  the 
Greeks  and  Romans,  by  the  artificial  ones  of  a  rigid  military 
discipline.  From  the  time  when  the  circumstances  of  modern 
society  permitted  the  discontinuance  of  that  discipline,  the 
South  has  no  longer  produced  conquering  nations;  military 
vigor,  as  well  as  speculative  thought  and  industrial  energy, 
have  all  had  their  principal  seats  in  the  less  favored  North. 

As  the  secon<j.  therefore,  of  the  causes  of  superior  produc¬ 
tiveness,  we  may  rank  the  ^greater  energy  of  labor.  By  this  is 
not  to  be  understood  occasional,  but  regular  and  habitual  energy. 
No  one  undergoes,  without  murmuring,  a  greater  amount  of 
occasional  fatigue  and  hardship,  or  has  his  bodily  powers,  and 
such  faculties  of  mind  as  he  possesses,  kept  longer  at  their  ut¬ 

most  stretch,  than  the  North  American  Indian ;  yet  his  indo¬ 
lence  is  proverbial,  whenever  he  has  a  brief  respite  from  tlie 
pressure  of  present  wants.  Individuals,  or  nations^do  not  differ 
so  much  in  the  efforts  they  are  able  and  willing  to  make  under 
strong  immediate  incentives,  as  in  their  capacity  of  present 
exertion  for  a  distant  object,  and  in  the  thoroughness  of  their 
application  to  work  on  ordinary  occasions.  Some  amount  of 
these  qualities  is  a  necessary  condition  of  any  great  improve¬ 
ment  among  mankind.  To  civilize  a  savage,  he  must  be  in¬ 
spired  with  new  wants  and  desires,  even  if  not  of  a  very  ele¬ 
vated  kind,  provided  that  their  gratification  can  be  a  motive 
to  steady  and  regular  bodily  and  mental  exertion.  If  the  ne¬ 
groes  of  Jamaica  and  Demerara,  after  their  emancipation,  had 


104 


POLITICAL  ECONOMY 


contented  themselves,  as  it  was  predicted  they  would  do,  with 
the  necessaries  of  life,  and  abandoned  all  labor  beyond  the  little 
which  in  a  tropical  climate,  with  a  thin  population  and  abun¬ 
dance  of  the  richest  land,  is  sufficient  to  support  existence,  they 
would  have  sunk  into  a  condition  more  barbarous,  though  less 
unhappy,  than  their  previous  state  of  slavery.  The  motive  which 
was  most  relied  on  for  inducing  them  to  work  was  their  love 
of  fine  clothes  and  personal  ornaments.  No  one  will  stand  up 
for  this  taste  as  worthy  of  being  cultivated,  and  in  most  so¬ 
cieties  its  indulgence  tends  to  impoverish  rather  than  to  enrich ; 
but  in  the  state  of  mind  of  the  negroes  it  might  have  been  the 
only  incentive  that  could  make  them  voluntarily  undergo  sys¬ 
tematic  labor,  and  so  acquire  or  maintain  habits  of  voluntary 
industry  which  may  be  converted  to  more  valuable  ends.  In 
England,  it  is  not  the  desire  of  wealth  that  needs  to  be  taught, 
but  the  use  of  wealth,  and  appreciation  of  the  objects  of  desire 
which  wealth  cannot  purchase,  or  for  attaining  which  it  is  not 
required.  Every  real  improvement  in  the  character  of  the 
English,  whether  it  consist  in  giving  them  higher  aspirations, 
or  only  a  juster  estimate  of  the  value  of  their  present  objects 
of  desire,  must  necessarily  moderate  the  ardor  of  their  devotion 
to  the  pursuit  of  wealth.  There  is  no  need,  however,  that  it 
should  diminish  the  strenuous  and  business-like  application  to 
the  matter  in  hand,  which  is  found  in  the  best  English  work¬ 
men,  and  is  their  most  valuable  quality. 

The  desirable  medium  is  one  which  mankind  have  not  often 
known  how  to  hit :  when  they  labor,  to  do  it  with  all  their  might, 
and  especially  with  all  their  mind ;  but  to  devote  to  labor,  for 
mere  pecuniary  gain,  fewer  hours  in  the  day,  fewer  days  in  the 
year,  and  fewer  years  of  life. 

§  4.  The  J;hird  element  which  determines  the  productiveness 
of  the  labor  of  a  community,  is  the  skill  and  knowledge  therein 
existing ;  whether  it  be  the  skill  and  knowledge  of  the  laborers 
themselves,  or  of  those  who  direct  their  labor.  No  illustration 
is  requisite  to  show  how  the  efficacy  of  industry  is  promoted 
by  the  manual  dexterity  of  those  who  perform  mere  routine 
processes ;  by  the  intelligence  of  those  engaged  in  operations 
in  which  the  mind  has  a  considerable  part ;  and  by  the  amount 
of  knowledge  of  natural  powers  and  of  the  properties  of  objects, 
which  is  turned  to  the  purposes  of  industry.  That  the  produc¬ 
tiveness  of  the  labor  of  a  people  is  limited  by  their  knowledge 


DEGREES  OF  PRODUCTIVENESS 


io5 

of  the  arts  of  life,  is  self-evident ;  and  that  any  progress  in 
those  arts,  any  improved  application  of  the  objects  or  powers 
of  nature  to  industrial  uses,  enables  the  same  quantity  and  in¬ 
tensity  of  labor  to  raise  a  greater  produce. 

One  principal  department  of  these  improvements  consists  in 
the  invention  and  use  of  tools  and  machinery.  The  manner  in 
which  these  serve  to  increase  production  and  to  economize  labor, 
needs  not  be  specially  detailed  in  a  work  like  the  present:  it 
will  be  found  explained  and  exemplified,  in  a  manner  at  once 
scientific  and  popular,  in  Mr.  Babbage’s  well-known  “  Economy 
of  Machinery  and  Manufactures.”  An  entire  chapter  of  Mr. 
Babbage’s  book  is  composed  of  instances  of  the  efficacy  of 
machinery  in  “  exerting  forces  too  great  for  human  power, 
and  executing  operations  too  delicate  for  human  touch.”  But 
to  find  examples  of  work  which  could  not  be  performed  at  all 
by  unassisted  labor,  we  need  not  go  so  far.  Without  pumps, 
worked  by  steam  engines  or  otherwise,  the  water  which  collects 
in  mines  could  not  in  many  situations  be  got  rid  of  at  all,  and 
the  mines,  after  being  worked  to  a  little  depth,  must  be  aban¬ 
doned  :  without  ships  or  boats  the  sea  could  never  have  been 
crossed ;  without  tools  of  some  sort,  trees  could  not  be  cut 
down,  nor  rocks  excavated;  a  plough,  or  at  least  a  hoe,  is 
necessary  to  any  tillage  of  the  ground.  Very  simple  and  rude 
instruments,  however,  are  sufficient  to  render  literally  possible 
most  works  hitherto  executed  by  mankind ;  and  subsequent  in¬ 
ventions  have  chiefly  served  to  enable  the  work  to  be  performed 
in  greater  perfection,  and,  above  all,  with  a  greatly  diminished 
quantity  of  labor:  the  labor  thus  saved  becoming  disposable 
for  other  employment. 

The  use  of  machinery  is  far  from  being  the  only  mode  in 
which  the  effects  of  knowledge  in  aiding  production  are  exem¬ 
plified.  In  agriculture  and  horticulture,  machinery  is  only  now 
beginning  to  show  that  it  can  do  anything  of  importance,  be¬ 
yond  the  invention  and  progressive  improvement  of  the  plough 
and  a  few  other  simple  instruments.  The  greatest  agricultural 
inventions  have  consisted  in  the  direct  application  of  more  judi¬ 
cious  processes  to  the  land  itself,  and  to  the  plants  growing  on 
it :  such  as  rotation  of  crops,  to  avoid  the  necessity  of  leaving 
the  land  uncultivated  for  one  season  in  every  two  or  three; 
improved  manures,  to  renovate  its  fertility  when  exhausted  by 
cropping;  ploughing  and  draining  the  subsoil  as  well  as  the 


io6 


POLITICAL  ECONOMY 


surface ;  conversion  of  bogs  and  marshes  into  cultivable  land ; 
such  modes  of  pruning,  and  of  training  and  propping  up  plants 
and  trees,  as  experience  has  shown  to  deserve  the  preference ; 
in  the  case  of  the  more  expensive  cultures,  planting  the  roots 
or  seeds  farther  apart,  and  more  completely  pulverizing  the 
soil  in  which  they  are  placed,  etc.  In  manufactures  and  com¬ 
merce,  some  of  the  most  important  improvements  consist  in 
economizing  time ;  in  making  the  return  follow  more  speedily 
upon  the  labor  and  outlay.  There  are  others  of  which  the  ad¬ 
vantage  consists  in  economy  of  material. 

§  5.  But  the  effects  of  the  increased  knowledge  of  a  commu¬ 
nity  in  increasing  its  wealth,  need  the  less  illustration  as  they 
have  become  familiar  to  the  most  uneducated,  from  such  con¬ 
spicuous  instances  as  railways  and  steamships.  A  thing  not 
yet  so  well  understood  and  recognized,  is  the  economical  value 
of  the  general  diffusion  of  intelligence  among  the  people.  The 
number  of  persons  fitted  to  direct  and  superintend  any  indus¬ 
trial  enterprise,  or  even  to  execute  any  process  which  cannot 
be  reduced  almost  to  an  affair  of  memory  and  routine,  is  always 
far  short  of  the  demand ;  as  is  evident  from  the  enormous  dif¬ 
ference  between  the  salaries  paid  to  such  persons,  and  the  wages 
of  ordinary  labor.  The  deficiency  of  practical  good  sense,  which 
renders  the  majority  of  the  laboring  class  such  bad  calculators 
— which  makes,  for  instance,  their  domestic  economy  so  im¬ 
provident,  lax,  and  irregular — must  disqualify  them  for  any 
but  a  low  grade  of  intelligent  labor,  and  render  their  industry 
far  less  productive  than  with  equal  energy  it  otherwise  might 
be.  The  importance,  even  in  this  limited  aspect  of  popular  edu¬ 
cation,  is  well  worthy  of  the  attention  of  politicians,  especially 
in  England ;  since  competent  observers,  accustomed  to  employ 
laborers  of  various  nations,  testify  that  in  the  workmen  of  other 
countries  they  often  find  great  intelligence  wholly  apart  from 
instruction,  but  that  if  an  English  laborer  is  anything  but  a 
hewer  of  wood  and  a  drawer  of  water,  he  is  indebted  for  it  to 
education,  which  in  his  case  is  almost  always  self-education. 
Mr.  Escher,  of  Zurich,  (an  engineer  and  cotton  manufacturer 
employing  nearly  two  thousand  workingmen  of  many  different 
nations),  in  his  evidence  annexed  to  the  “  Report  of  the  Poor 
Law  Commissioners,”  in  1840,  on  the  training  of  pauper  chil¬ 
dren,  gives  a  character  of  English  as  contrasted  with  Conti¬ 
nental  workmen,  which  all  persons  of  similar  experience  will, 

I  believe,  confirm. 


DEGREES  OF  PRODUCTIVENESS 


107 

“  The  Italians’  quickness  of  perception  is  shown  in  rapidly 
comprehending  any  new  descriptions  of  labor  put  into  their 
hands,  in  a  power  of  quickly  comprehending  the  meaning  of 
their  employer,  of  adapting  themselves  to  new  circumstances, 
much  beyond  what  any  other  classes  have.  The  French  work¬ 
men  have  the  like  natural  characteristics,  only  in  a  somewhat 
lower  degree.  The  English,  Swiss,  German,  and  Dutch  work¬ 
men,  we  find,  have  all  much  slower  natural  comprehension.  As 
workmen  only,  the  preference  is  undoubtedly  due  to  the  Eng¬ 
lish  ;  because,  as  we  find  them,  they  are  all  trained  to  special 
branches,  on  which  they  have  had  comparatively  superior  train¬ 
ing,  and  have  concentrated  all  their  thoughts.  As  men  of  busi¬ 
ness  or  of  general  usefulness,  and  as  men  with  whom  an  em¬ 
ployer  would  best  like  to  be  surrounded,  I  should,  however, 
decidedly  prefer  the  Saxons  and  the  Swiss,  but  more  especially 
the  Saxons,  because  they  have  had  a  very  careful  general  educa¬ 
tion,  which  has  extended  their  capacities  beyond  any  special 
employment,  and  rendered  them  fit  to  take  up,  after  a  short 
preparation,  any  employment  to  which  they  may  be  called.  If 
I  have  an  English  workman  engaged  in  the  erection  of  a  steam- 
engine,  he  will  understand  that,  and  nothing  else ;  and  for  other 
circumstances  or  other  branches  of  mechanics,  however  closely 
allied,  he  will  be  comparatively  helpless  to  adapt  himself  to  all 
the  circumstances  that  may  arise,  to  make  arrangements  for 
them,  and  give  sound  advice  or  write  clear  statements  and  let¬ 
ters  on  his  work  in  the  various  related  branches  of  mechanics.” 

On  the  connection  between  mental  cultivation  and  moral 
trustworthiness  in  the  laboring  class,  the  same  witness  says: 
“  The  better  educated  workmen,  we  find,  are  distinguished  by 
superior  moral  habits  in  every  respect.  In  the  first  place,  they 
are  entirely  sober;  they  are  discreet  in  their  enjoyments,  which 
are  of  a  more  rational  and  refined  kind ;  they  have  a  taste  for 
much  better  society,  which  they  approach  respectfully,  and  con¬ 
sequently  find  much  readier  admittance  to  it;  they  cultivate 
music;  they  read;  they  enjoy  the  pleasures  of  scenery,  and 
make  parties  for  excursions  in  the  country ;  they  are  economi¬ 
cal,  and  their  economy  extends  beyond  their  own  purse  to  the 
stock  of  their  master ;  they  are,  consequently,  honest  and  trust¬ 
worthy.”  And  in  answer  to  a  question  respecting  the  English 
workmen :  “  Whilst  in  respect  to  the  work  to  which  they  have 
been  specially  trained  they  are  the  most  skilful,  they  are  in 


io8 


POLITICAL  ECONOMY 


conduct  the  most  disorderly,  debauched,  and  unruly,  and  least 
respectable  and  trustworthy  of  any  nation  whatsoever  whom 
we  have  employed ;  and  in  saying  this,  I  express  the  experience 
of  every  manufacturer  on  the  Continent  to  whom  I  have  spoken, 
and  especially  of  the  English  manufacturers,  who  make  the 
loudest  complaints.  These  characteristics  of  depravity  do  not 
apply  to  the  English  workmen  who  have  received  an  education, 
but  attach  to  the  others  in  the  degree  in  which  they  are  in  want 
of  it.  When  the  uneducated  English  workmen  are  released 
from  the  bonds  of  iron  discipline  in  which  they  have  been  re¬ 
strained  by  their  employers  in  England,  and  are  treated  with 
the  urbanity  and  friendly  feeling  which  the  more  educated  work¬ 
men  on  the  Continent  expect  and  receive  from  their  employers, 
they,  the  English  workmen,  completely  lose  their  balance :  they 
do  not  understand  their  position,  and  after  a  certain  time  be¬ 
come  totally  unmanageable  and  useless.”  *  This  result  of  ob¬ 
servation  is  borne  out  by  experience  in  England  itself.  As  soon 
as  any  idea  of  equality  enters  the  mind  of  an  uneducated  English 
workingman,  his  head  is  turned  by  it.  When  he  ceases  to  be 
servile,  he  becomes  insolent. 

The  moral  qualities  of  the  laborers  are  fully  as  important 
to  the  efficiency  and  worth  of  their  labor,  as  the  intellectual. 
Independently  of  the  effects  of  intemperance  upon  their  bodily 
and  mental  faculties,  and  of  flighty  unsteady  habits  upon  the 
energy  and  continuity  of  their  work  (points  so  easily  under¬ 
stood  as  not  to  require  being  insisted  upon),  it  is  well  worthy 
of  meditation,  how  much  of  the  aggregate  effect  of  their  labor 
depends  on  their  trustworthiness.  All  the  labor  now  expended 
in  watching  that  they  fulfil  their  engagement,  or  in  verifying 
that  they  have  fulfilled  it,  is  so  much  withdrawn  from  the  real 
business  of  production,  to  be  devoted  to  a  subsidiary  function 
rendered  needful  not  by  the  necessity  of  things,  but  by  the  dis¬ 
honesty  of  men.  Nor  are  the  greatest  outward  precautions  more 
than  very  imperfectly  efficacious,  where,  as  is  now  almost  in¬ 
variably  the  case,  with  hired  laborers,  the  slightest  relaxation 
of  vigilance  is  an  opportunity  eagerly  seized  for  eluding  per¬ 
formance  of  their  contract.  The  advantage  to  mankind  of 
being  able  to  trust  one  another,  penetrates  into  every  crevice 
and  cranny  of  human  life :  the  economical  is  perhaps  the  small- 

*  The  whole  evidence  of  this  intelli-  much  testimony  on  similar  points  by 
gent  and  experienced  employer  of  labor  other  witnesses,  contained  in  the  same 
as  deserving  of  attention;  as  well  as  volume. 


DEGREES  OF  PRODUCTIVENESS 


109 

est  part  of  it,  yet  even  this  is  incalculable.  To  consider  only 
the  most  obvious  part  of  the  waste  of  wealth  occasioned  to 
society  by  human  improbity;  there  is  in  all  rich  communities 
a  predatory  population,  who  live  by  pillaging  or  over-reaching 
other  people ;  their  numbers  cannot  be  authentically  ascertained, 
but  on  the  lowest  estimate,  in  a  country  like  England,  it  is  very 
large.  The  support  of  these  persons  is  a  direct  burthen  on  the 
national  industry.  The  police,  and  the  whole  apparatus  of 
punishment,  and  of  criminal  and  partly  of  civil  justice,  are 
a  second  burthen  rendered  necessary  by  the  first.  The  ex¬ 
orbitantly  paid  profession  of  lawyers,  so  far  as  their  work  is 
not  created  by  defects  in  the  law  of  their  own  contriving,  are 
required  and  supported  principally  by  the  dishonesty  of  man¬ 
kind.  As  the  standard  of  integrity  in  a  community  rises  higher, 
all  these  expenses  become  less.  But  this  positive  saving  would 
be  far  outweighed  by  the  immense  increase  in  the  produce  of  all 
kinds  of  labor,  and  saving  of  time  and  expenditure,  which  would 
be  obtained  if  the  laborers  honestly  performed  what  they  under¬ 
take  ;  and  by  the  increased  spirit,  the  feeling  of  power  and  con¬ 
fidence,  with  which  works  of  all  sorts  would  be  planned  and 
carried  on  by  those  who  felt  that  all  whose  aid  was  required 
would  do  their  part  faithfully  according  to  their  contracts.  Con¬ 
joint  action  is  possible  just  in  proportion  as  human  beings  can 
rely  on  each  other.  There  are  countries  in  Europe,  of  first-rate 
industrial  capabilities,  where  the  most  serious  impediment  to 
conducting  business  concerns  on  a  large  scale,  is  the  rarity  of 
persons  who  are  supposed  fit  to  be  trusted  with  the  receipt  and 
expenditure  of  large  sums  of  money.  There  are  nations  whose 
commodities  are  looked  shyly  upon  by  merchants,  because  they 
cannot  depend  on  finding  the  quality  of  the  article  conform¬ 
able  to  that  of  the  sample.  Such  short-sighted  frauds  are  far 
from  unexampled  in  English  exports.  Everyone  has  heard  of 
“  devil’s  dust  ”  :  and  among  other  instances  given  by  Mr.  Bab¬ 
bage,  is  one  in  which  a  branch  of  export  trade  was  for  a  long 
time  actually  stopped  by  the  forgeries  and  frauds  which  had 
occurred  in  it.  On  the  other  hand  the  substantial  advantage 
derived  in  business  transactions  from  proved  trustworthiness, 
is  not  less  remarkably  exemplified  in  the  same  work.  “  At  one 
of  our  largest  towns,  sales  and  purchases  on  a  very  extensive 
scale  are  made  daily  in  the  course  of  business  without  any  of 
the  parties  ever  exchanging  a  written  document.”  Spread  over 


no 


POLITICAL  ECONOMY 


a  year’s  transactions,  how  great  a  return,  in  saving  of  time, 
trouble,  and  expense,  is  brought  in  to  the  producers  and  dealers 
of  such  a  town  from  their  own  integrity.  “  The  influence  of 
established  character  in  producing  confidence  operated  in  a 
very  remarkable  manner  at  the  time  of  the  exclusion  of  British 
manufactures  from  the  Continent  during  the  last  war.  One 
of  our  largest  establishments  had  been  in  the  habit  of  doing 
extensive  business  with  a  house  in  the  centre  of  Germany :  but 
on  the  closing  of  the  Continental  ports  against  our  manufact¬ 
ures,  heavy  penalties  were  inflicted  on  all  those  who  contravened 
the  Berlin  and  Milan  decrees.  The  English  manufacturer  con¬ 
tinued,  nevertheless,  to  receive  orders,  with  directions  how  to 
consign  them,  and  appointments  for  the  time  and  mode  of  pay¬ 
ment,  in  letters,  the  handwriting  of  which  was  known  to  him,  but 
which  were  never  signed  except  by  the  Christian  name  of  one 
of  the  firm,  and  even  in  some  instances  they  were  without  any 
signature  at  all.  These  orders  were  executed,  and  in  no  instance 
was  there  the  least  irregularity  in  the  payments.”  * 


*  Some  minor  instances  noticed  by 
Mr.  Babbage  may  be  cited  in  further 
illustration  of  the  waste  occasioned  to 
society  through  the  inability  of  its  mem¬ 
bers  to  trust  one  another. 

“  The  cost  to  the  purchaser  is  the 
price  he  pays  for  any  article,  added  to 
the  cost  of  verifying  the  fact  of  its  hav¬ 
ing  that  degree  of  goodness  for  which 
he  contracts.  In  some  cases,  the  good¬ 
ness  of  the  article  is  evident  on  mere 
inspection;  and  in  those  cases  there  is 
not  much  difference  of  price  at  different 
shops.  The  goodness  of  loaf  sugar,  for 
instance,  can  be  discerned  almost  at  a 
glance;  and  the  consequence  is,  that 
the  price  is  so  uniform,  and  the  profit 
upon  it  so  small,  that  no  grocer  is  at 
all  anxious  to  sell  it  ;  whilst  on  the  other 
hand,  tea,  of  which  it  is  exceedingly  dif¬ 
ficult  to  judge,  and  which  can  be  adul¬ 
terated  by  mixture  so  as  to  deceive  the 
skill  even  of  a  practised  eye,  has  a  great 
variety  of  different  prices,  and  is  that 
article  which  every  grocer  is  most  anx¬ 
ious  to  sell  to  his  customers.  The  diffi¬ 
culty  and  expense  of  verification  are  in 
some  instances  so  great  as  to  justify  the 
deviation  from  well-established  princi¬ 
ples.  Thus  it  is  a  general  maxim  that 
Government  can  purchase  any  article 
at  a  cheaper  rate  than  that  at  which 
they  can  manufacture  it  themselves.  But 
it  has,  nevertheless,  been  considered 
more  economical  to  build  extensive 
flour-mills  (such  as  those  at  Deptford), 
and  to  grind  their  own  corn,  than  to 
verify  each  sack  of  purchased  flour,  and 
to  employ  persons  in  devising  methods 
of  detecting  the  new  modes  of  adultera¬ 
tion  which  might  be  continually  resort¬ 
ed  to.”  A  similar  want  of  confidence 


might  deprive  a  nation,  such  as  the 
United  States,  of  a  large  export  trade 
in  flour. 

Again:  “  Some  years  since,  a  mode 
of  preparing  old  clover  and  trefoil  seeds 
by  a  process  called  doctoring  became  so 
prevalent  as  to  excite  the  attention  of 
the  House  of  Commons.  It  appeared  in 
evidence  before  a  Committee,  that  the 
old  seed  of  the  white  clover  was  doc¬ 
tored  by  first  wetting  it  slightly,  and 
then  drying  it  by  the  fumes  of  burning 
sulphur;  and  that  the  red  clover  seed 
had  its  color  improved  by  shaking  it  in 
a  sack  with  a  small  quantity  of  indigo; 
but  this  being  detected  after  a  time,  the 
doctors  then  used  a  preparation  of  log- 
.wood,  fined  by  a  little  copperas,  and 
sometimes  by  verdigris;  thus  at  once 
improving  the  appearance  of  the  old 
seed,  and  diminishing,  if  not  destroying, 
its  vegetative  power,  already  enfeebled 
by  age.  Supposing  no  injury  had  re¬ 
sulted  to  good  seed  so  prepared,  it  was 
proved  that,  from  the  improved  appear¬ 
ance,  the  market  price  would  be  en¬ 
hanced  by  this  process  from  five  to 
twenty-five  shillings  a  hundred-weight. 
But  the  greatest  evil  arose  from  the  cir¬ 
cumstance  of  these  processes  rendering 
old  and  worthless  seed  equal  in  appear¬ 
ance  to  the  best.  One  witness  had  tried 
some  doctored  seed,  and  found  that  not 
above  one  grain  in  a  hundred  grew,  and 
that  those  which  did  vegetate  died  away 
afterwards;  whilst  about  eighty  or  ninety 
per  cent,  of  good  seed  usually  grows. 
The  seed  so  treated  was  sold  to  retail 
dealers  in  the  country,  who  of  course 
endeavored  to  purchase  at  the  cheapest 
rate,  and  from  them  it  got  into  the 
hands  of  the  farmers,  neither  of  these 


DEGREES  OF  PRODUCTIVENESS 


m 


§  6.  Among  the  secondary  causes  which  determine  the  pro¬ 
ductiveness  of  productive  agents,  the  most  important  is  Se- 
gnrjtv— »Rv  security  I  mean  the,  completeness  of  the  protection 
which  society  affords  to  its  members.  This  consists  of  pro¬ 
tection  by  the  government,  and  protection  against  the  govern¬ 
ment.  The  latter  is  the  more  important.  Where  a  person 
known  to  possess  anything  worth  taking  away,  can  expect 
nothing  but  to  have  it  torn  from  him,  with  every  circumstance 
of  tyrannical  violence,  by  the  agents  of  a  rapacious  govern¬ 
ment,  it  is  not  likely  that  many  will  exert  themselves  to  produce 
much  more  than  necessaries.  This  is  the  acknowledged  ex¬ 
planation  of  the  poverty  of  many  fertile  tracts  of  Asia,  which 
were  once  prosperous  and  populous.  From  this  to  the  degree 
of  security  enjoyed  in  the  best  governed  parts  of  Europe,  there 
are  numerous  gradations.  In  many  provinces  of  France,  be¬ 
fore  the  Revolution,  a  vicious  system  of  taxation  on  the  land, 
and  still  more  the  absence  of  redress  against  the  arbitrary  ex¬ 
actions  which  were  made  under  color  of  the  taxes,  rendered 
it  the  interest  of  every  cultivator  to  appear  poor,  and  therefore 
to  cultivate  badly.  The  only  insecurity  which  is  altogether 
paralyzing  to  the  active  energies  of  producers,  is  that  arising 
from  the  government,  or  from  persons  invested  with  its  au¬ 
thority.  Against  all  other  depredators  there  is  a  hope  of  de¬ 
fending  one’s  self.  Greece  and  the  Greek  colonies  in  the  ancient 
world,  Flanders  and  Italy  in  the  Middle  Ages,  by  no  means 
enjoyed  what  anyone  with  modern  ideas  would  call  security: 


classes  being  capable  of  distinguishing 
the  fraudulent  from  the  genuine  seed. 
Many  cultivators  in  consequence  dimin¬ 
ished  their  consumption  of  the  articles, 
and  others  were  obliged  to  pay  a  higher 
price  to  those  who  had  skill  to  distin¬ 
guish  the  mixed  seed,  and  who  had  in¬ 
tegrity  and  character  to  prevent  them 
from  dealing  in  it.” 

The  same  writer  states  that  Irish  flax, 
though  in  natural  quality  inferior  to 
none,  sells,  or  did  lately  sell,  in  the 
market  at  a  penny  to  twopence  per 
pound  less  than  foreign  or  British  flax; 
part  of  the  difference  arising  from  neg¬ 
ligence  in  its  preparation,  but  part  from 
the  cause  mentioned  in  the  evidence  of 
Mr.  Corry,  many  years  Secretary  to  the 
Irish  Linen  Board:  “The  owners  of 
the  flax,  who  are  almost  always  people 
in  the  lower  classes  of  life,  believe  that 
they  can  best  advance  their  own  inter¬ 
ests  by  imposing  on  the  buyers.  Flax 
being  sold  by  weight,  various  expedients 
are  used  to  increase  it;  and  every  expe¬ 
dient  is  injurious,  particularly  the  damp¬ 


ing  of  it ;  a  very  common  practice, 
which  makes  the  flax  afterwards  heat. 
The  inside  of  every  bundle  (and  the 
bundles  all  vary  in  bulk)  is  often  full 
of  pebbles,  or  dirt  of  various  kinds,  to 
increase  the  weight.  In  this  state  it  is 
purchased  and  exported  to  Great  Brit¬ 
ain.” 

It  was  given  in  evidence  before  a  Com¬ 
mittee  of  the  House  of  Commons  that 
the  lace  trade  at  Nottingham  had  great¬ 
ly  fallen  off,  from  the  making  of  fraudu¬ 
lent  and  bad  articles:  that  “a  kind  of 
lace  called  single-press  was  manufact¬ 
ured,”  (I  still  quote  Mr.  Babbage) 
“  which,  although  good  to  the  eye,  be¬ 
came  nearly  spoiled  in  washing  by  the 
slipping  of  the  threads;  that  not  one 
person  in  a  thousand  could  distinguish 
the  difference  between  single-press  and 
double-press  lace;  that  even  workmen 
and  manufacturers  were  obliged  to  em¬ 
ploy  a  magnifying-glass  for  that  pur¬ 
pose;  and  that  in  another  similar  arti¬ 
cle,  called  warp-lace,  such  aid  was  es¬ 
sential.” 


1 1  2 


POLITICAL  ECONOMY 


the  state  of  society  was  most  unsettled  and  turbulent ;  person 
and  property  were  exposed  to  a  thousand  dangers.  But  they 
were  free  countries ;  they  were  in  general  neither  arbitrarily 
oppressed,  nor  systematically  plundered  by  their  governments. 
Against  other  enemies  the  individual  energy  which  their  insti¬ 
tutions  called  forth,  enabled  them  to  make  successful  resist¬ 
ance:  their  labor,  therefore,  was  eminently  productive,  and 
their  riches,  while  they  remained  free,  were  constantly  on  the 
increase.  The  Roman  despotism,  putting  an  end  to  wars  and 
internal  conflicts  throughout  the  empire,  relieved  the  subject 
population  from  much  of  the  former  insecurity :  but  because  it 
left  them  under  the  grinding  yoke  of  its  own  rapacity,  they 
became  enervated  and  impoverished,  until  they  were  an  easy 
prey  to  barbarous  but  free  invaders.  They  would  neither  fight 
nor  labor,  because  they  were  no  longer  suffered  to  enjoy  that 
for  which  they  fought  and  labored. 

Much  of  the  security  of  person  and  property  in  modern  na¬ 
tions  is  the  effect  of  manners  and  opinion  rather  than  of  law. 
There  are,  or  lately  were,  countries  in  Europe  where  the  mon¬ 
arch  was  nominally  absolute,  but  where,  from  the  restraints 
imposed  by  established  usage,  no  subject  felt  practically  in  the 
smallest  danger  of  having  his  possessions  arbitrarily  seized  or 
a  contribution  levied  on  them  by  the  government.  There  must, 
however,  be  in  such  governments  much  petty  plunder  and 
other  tyranny  by  subordinate  agents,  for  which  redress  is  not 
obtained,  owing  to  the  want  of  publicity  which  is  the  ordinary 
character  of  absolute  governments.  In  England  the  people 
are  tolerably  well  protected,  both  by  institutions  and  manners, 
against  the  agents  of  government;  but,  for  the  security  they 
enjoy  against  other  evildoers,  they  are  very  little  indebted  to 
their  institutions.  The  laws  cannot  be  said  to  afford  protection 
to  property,  when  they  afford  it  only  at  such  a  cost  as  renders 
submission  to  injury  in  general  the  better  calculation.  The 
security  of  property  in  England  is  owing  (except  as  regards 
open  violence)  to  opinion,  and  the  fear  of  exposure,  much  more 
than  to  the  direct  operation  of  the  law  and  the  courts  of  justice. 

Independently  of  all  imperfection  in  the  bulwarks  which  so¬ 
ciety  purposely  throws  round  what  it  recognizes  as  property, 
there  are  various  other  modes  in  which  defective  institutions 
impede  the  employment  of  the  productive  resources  of  a  coun¬ 
try  to  the  best  advantage.  We  shall  have  occasion  for  noticing 


COMBINATION  OF  LABOR 


i*3 

many  of  these  in  the  progress  of  our  subject.  It  is  sufficient 
here  to  remark,  that  the  efficiency  of  industry  may  be  expected 
to  be  great,  in  proportion  as  the  fruits  of  industry  are  insured 
to  the  person  exerting  it :  and  that  all  social  arrangements  are 
conducive  to  useful  exertion,  according  as  they  provide  that 
the  reward  of  every  one  for  his  labor  shall  be  proportioned  as 
much  as  possible  to  the  benefit  which  it  produces.  All  laws  or 
usages  which  favor  one  class  or  sort  of  persons  to  the  disad¬ 
vantage  of  others  ;  which  chain  up  the  efforts  of  any  part  of  the 
community  in  pursuit  of  their  own  good,  or  stand  between 
those  efforts  and  their  natural  fruits — are  (independently  of  all 
other  grounds  of  condemnation)  violations  of  the  fundamental 
principles  of  economical  policy ;  tending  to  make  the  aggre¬ 
gate  productive  powers  of  the  community  productive  in  a  less 
degree  than  they  would  otherwise  be. 


Chapter  VIII.  —  Of  Co-operation,  or  the  Combination  of  Labor 

§  i.  In  the  enumeration  of  the  circumstances  which  promote 
the  productiveness  of  labor,  we  have  left  one  untouched,  which, 
because  of  its  importance,  and  of  the  many  topics  of  discussion 
which  it  involves,  requires  to  be  treated  apart.  This  is,  co¬ 
operation,  or  the  combined  action  of  numbers.  Of  this  great 
aid  to  production,  a  single  department,  known  by  the  name  of 
pivision  of  Labor,  has  engaged  a  large  share  of  the  attention 
of  political  economists ;  most  deservedly  indeed,  but  to  the  ex¬ 
clusion  of  other  cases  and  exemplifications  of  the  same  com¬ 
prehensive  law.  Mr.  Wakefield  was,  I  believe,  the  first  to  point 
out,  that  a  part  of  the  subject  had,  with  injurious  effect,  been 
mistaken  for  the  whole;  that  a  more  fundamental  principle 
lies  beneath  that  of  the  division  of  labor,  and  comprehends  it. 

Co-operation,  he  observes,*  is  “  of  two  distinct  kinds:  first, 
such  co-operation  as  takes  place  when  several  persons  help 
each  other  in  the  same  employment ;  secondly,  such  co-opera¬ 
tion  as  takes  place  when  several  persons  help  each  other  in 
different  employments.  These  may  be  termed  Simple  Co¬ 
operation  and  Complex  Co-operation. 

“  The  advantage  of  simple  co-operation  is  illustrated  by  the 
case  of  two  greyhounds  running  together,  which,  it  is  said,  will 

*  Note  to  Wakefield’s  edition  of  Adam  Smith,  vol.  i.  p.  26. 

VOL.  I. — 8 


POLITICAL  ECONOMY 


114 

kill  more  hares  than  four  greyhounds  running  separately.  In 
a  vast  number  of  simple  operations  performed  by  human  exer¬ 
tion,  it  is  quite  obvious  that  two  men  working  together  will  do 
more  than  four,  or  four  times  four  men,  each  of  whom  should 
work  alone.  In  the  lifting  of  heavy  weights,  for  example,  in 
the  felling  of  trees,  in  the  sawing  of  timber,  in  the  gathering 
of  much  hay  or  corn  during  a  short  period  of  fine  weather,  in 
draining  a  large  extent  of  land  during  the  short  season  when 
such  a  work  may  be  properly  conducted,  in  the  pulling  of  ropes 
on  board  ship,  in  the  rowing  of  large  boats,  in  some  mining 
operations,  in  the  erection  of  a  scaffolding  for  building,  and  in 
the  breaking  of  stones  for  the  repair  of  a  road,  so  that  the  whole 
of  the  road  shall  always  be  kept  in  good  order ;  in  all  these  sim¬ 
ple  operations,  and  thousands  more,  it  is  absolutely  necessary 
that  many  persons  should  work  together,  at  the  same  time,  in 
the  same  place,  and  in  the  same  way.  The  savages  of  New 
Holland  never  help  each  other,  even  in  the  most  simple  opera¬ 
tions  ;  and  their  condition  is  hardly  superior,  in  some  respects 
it  is  inferior,  to  that  of  the  wild  animals  which  they  now  and 
then  catch.  Let  anyone  imagine  that  the  laborers  of  England 
should  suddenly  desist  from  helping  each  other  in  simple  em¬ 
ployments,  and  he  will  see  at  once  the  prodigious  advantages  of 
simple  co-operation.  In  a  countless  number  of  employments, 
the  produce  of  labor  is,  up  to  a  certain  point,  in  proportion  to 
such  mutual  assistance  amongst  the  workmen.  This  is  the 
first  step  in  social  improvement. ”  The  second  is,  when  “  onp 
body  of  men  having  combined  their  labor  to  raise  more  food 
than  they  require,  another  body  of  men  are  induced  to  combine 
their  labor  for  the  purpose  of  producing  more  clothes  than  they 
require,  and  with  those  clothes  buying  the  surplus  food  of  the 
other  body  of  laborers ;  while,  if  both  bodies  together  have 
produced  more  food  and  clothes  than  they  both  require,  both 
bodies  obtain,  by  means  of  exchange,  a  proper  capital  for  set¬ 
ting  more  laborers  to  work  in  their  respective  occupations.” 
To  simple  co-operation  is  thus  super-added  what  Mr.  Wake¬ 
field  terms  Complex  Co-operation.  The  one  is  the  combina¬ 
tion  of  several  laborers  to  help  each  other  in  the  same  set  of 
operations ;  the  other  is  the  combination  of  several  laborers 
to  help  one  another  by  a  division  of  operations. 

There  is  “  an  important  distinction  between  simple  and  com¬ 
plex  co-operation.  Of  the  former,  one  is  always  conscious  at 


COMBINATION  OF  LABOR 


ri5 


the  time  of  practising  it :  it  is  obvious  to  the  most  ignorant  and 
vulgar  eye.  Of  the  latter,  but  a  very  few  of  the  vast  numbers 
who  practise  it  are  in  any  degree  conscious.  The  cause  of  this 
distinction  is  easily  seen.  When  several  men  are  employed  in 
lifting  the  same  weight,  or  pulling  the  same  rope,  at  the  same 
time,  and  in  the  same  place,  there  can  be  no  sort  of  doubt  that 
they  co-operate  with  each  other ;  the  fact  is  impressed  on  the 
mind  by  the  mere  sense  of  sight;  but  when  several  men,  or 
bodies  of  men,  are  employed  at  different  times  and  places,  and 
in  different  pursuits,  their  co-operation  with  each  other,  though 
it  may  be  quite  as  certain,  is  not  so  readily  perceived  as  in  the 
other  case :  in  order  to  perceive  it,  a  complex  operation  of  the 
mind  is  required.” 

In  the  present  state  of  society  the  breeding  and  feeding  of 
sheep  is  the  occupation  of  one  set  of  people,  dressing  the  wool 
to  prepare  it  for  the  spinner  is  that  of  another,  spinning  it  into 
thread  of  a  third,  weaving  the  thread  into  broadcloth  of  a 
fourth,  dyeing  the  cloth  of  a  fifth,  making  it  into  a  coat  of  a 
sixth,  without  counting  the  multitude  of  carriers,  merchants, 
factors,  and  retailers  put  in  requisition  at  the  successive  stages 
of  this  progress.  All  these  persons,  without  knowledge  of  one 
another  or  previous  understanding,  co-operate  in  the  produc¬ 
tion  of  the  ultimate  result,  a  coat.  But  these  are  far  from 
being  all  who  co-operate  in  it;  for  each  of  these  persons  re¬ 
quires  food,  and  many  other  articles  of  consumption,  and 
unless  he  could  have  relied  that  other  people  would  produce 
these  for  him,  he  could  not  have  devoted  his  whole  time  to  one 
step  in  the  succession  of  operations  which  produces  one  single 
commodity,  a  coat.  Every  person  who  took  part  in  producing 
food  or  erecting  houses  for  this  series  of  producers,  has,  how¬ 
ever  unconsciously  on  his  part,  combined  his  labor  with  theirs. 
It  is  by  a  real,  though  unexpressed,  concert,  “  that  the  body 
who  raise  more  food  than  they  want,  can  exchange  with  the 
body  who  raise  more  clothes  than  they  want ;  and  if  the  two 
bodies  were  separated,  either  by  distance  or  disinclination — 
unless  the  two  bodies  should  virtually  form  themselves  into 
one,  for  the  common  object  of  raising  enough  food  and  clothes 
for  the  whole — they  could  not  divide  into  two  distinct  parts 
the  whole  operation  of  producing  a  sufficient  quantity  of  food 
and  clothes.” 

§  2.  The  influence  exercised  on  production  by  the  separation 


POLITICAL  ECONOMY 


1 16 

of  employments,  is  more  fundamental  than,  from  the  mode  in 
which  the  subject  is  usually  treated,  a  reader  might  be  induced 
to  suppose.  It  is  not  merely  that  when  the  production  of  dif¬ 
ferent  things  becomes  the  sole  or  principal  occupation  of  dif¬ 
ferent  persons,  a  much  greater  quantity  of  each  kind  of  article 
is  produced.  The  truth  is  much  beyond  this.  Without  some 
separation  of  employments,  very  few  things  would  be  produced 
at  all. 

Suppose  a  set  of  persons,  or  a  number  of  families,  all  em¬ 
ployed  precisely  in  the  same  manner ;  each  family  settled  on  a 
piece  of  its  own  land,  on  which  it  grows  by  its  labor  the  food 
required  for  its  own  sustenance,  and  as  there  are  no  persons 
to  buy  any  surplus  produce  where  all  are  producers,  each  fam¬ 
ily  has  to  produce  within  itself  whatever  other  articles  it  con¬ 
sumes.  In  such  circumstances,  if  the  soil  was  tolerably  fertile, 
and  population  did  not  tread  too  closely  on  the  heels  of  sub¬ 
sistence,  there  would  be,  no  doubt,  some  kind  of  domestic 
manufactures ;  clothing  for  the  family  might  perhaps  be  spun 
and  woven  within  it,  by  the  labor  probably  of  the  women  (a 
first  step  in  the  separation  of  employments) ;  and  a  dwelling 
of  some  sort  would  be  erected  and  kept  in  repair  by  their 
united  labor.  But  beyond  simple  food  (precarious,  too,  from 
the  variations  of  the  seasons),  coarse  clothing,  and  very  im¬ 
perfect  lodging,  it  would  be  scarcely  possible  that  the  family 
should  produce  anything  more.  They  would,  in  general,  re¬ 
quire  their  utmost  exertions  to  accomplish  so  much.  Their 
power  even  of  extracting  food  from  the  soil  would  be  kept  with¬ 
in  narrow  limits  by  the  quality  of  their  tools,  which  would 
necessarily  be  of  the  most  wretched  description.  To  do  almost 
anything  in  the  way  of  producing  for  themselves  articles  of 
convenience  or  luxury,  would  require  too  much  time,  and,  in 
many  cases,  their  presence  in  a  different  place.  Very  few 
kinds  of  industry,  therefore,  would  exist ;  and  that  which  did 
exist,  namely  the  production  of  necessaries,  would  be  extremely 
inefficient,  not  solely  from  imperfect  implements,  but  because, 
when  the  ground  and  the  domestic  industry  fed  by  it  had  been 
made  to  supply  the  necessaries  of  a  single  family  in  tolerable 
abundance,  there  would  be  little  motive,  while  the  numbers 
of  the  family  remained  the  same,  to  make  either  the  land  or  the 
labor  produce  more. 

But  suppose  an  event  to  occur,  which  would  amount  to  a 


COMBINATION  OF  LABOR 


117 


revolution  in  the  circumstances  of  this  little  settlement.  Sup¬ 
pose  that  a  company  of  artificers,  provided  with  tools,  and  with 
food  sufficient  to  maintain  them  for  a  year,  arrive  in  the  coun¬ 
try  and  establish  themselves  in  the  midst  of  the  population. 
These  new  settlers  occupy  themselves  in  producing  articles  of 
use  or  ornament  adapted  to  the  taste  of  a  simple  people ;  and 
before  their  food  is  exhausted  they  have  produced  these  in 
considerable  quantity,  and  are  ready  to  exchange  them  for 
more  food.  The  economical  position  of  the  landed  population 
is  now  most  materially  altered.  They  have  an  opportunity 
given  them  of  acquiring  comforts  and  luxuries.  Things  which, 
while  they  depended  solely  on  their  own  labor,  they  never  could 
have  obtained,  because  they  could  not  have  produced,  are  now 
accessible  to  them  if  they  can  succeed  in  producing  an  addi¬ 
tional  quantity  of  food  and  necessaries.  They  are  thus  incited 
to  increase  the  productiveness  of  their  industry.  Among  the 
conveniences  for  the  first  time  made  accessible  to  them,  better 
tools  are  probably  one ;  and  apart  from  this,  they  have  a  mo¬ 
tive  to  labor  more  assiduously,  and  to  adopt  contrivances  for 
making  their  labor  more  effectual.  By  these  means  they  will 
generally  succeed  in  compelling  their  land  to  produce,  not 
only  food  for  themselves,  but  a  surplus  for  the  newcomers, 
wherewith  to  buy  from  them  the  products  of  their  industry. 
The  new  settlers  constitute  what  is  called  a  market  for  surplus 
agricultural  produce :  and  their  arrival  has  enriched  the  settle¬ 
ment  not  only  by  the  manufactured  articles  which  they  pro¬ 
duce,  but  by  the  food  which  would  not  have  been  produced 
unless  they  had  been  there  to  consume  it. 

There  is  no  inconsistency  between  this  doctrine,  and  the 
proposition  we  before  maintained,  that  a  market  for  commodi¬ 
ties  does  not  constitute  employment  for  labor.*  The  labor  of 
the  agriculturists  was  already  provided  with  employment; 
they  are  not  indebted  to  the  demand  of  the  newcomers  for 
being  able  to  maintain  themselves.  What  that  demand  does 
for  them  is,  to  call  their  labor  into  increased  vigor  and  effi¬ 
ciency  ;  to  stimulate  them,  by  new  motives,  to  new  exertions. 
Neither  do  the  newcomers  owe  their  maintenance  and  employ¬ 
ment  to  the  demand  of  the  agriculturists :  with  a  year’s  sub¬ 
sistence  in  store,  they  could  have  settled  side  by  side  with  the 
former  inhabitants,  and  produced  a  similar  scanty  stock  of 


*  Supra,  pp.  79— 8S* 


n8 


POLITICAL  ECONOMY 


food  and  necessaries.  Nevertheless,  we  see  of  what  supreme 
importance  to  the  productiveness  of  the  labor  of  producers,  is 
the  existence  of  other  producers  within  reach,  employed  in  a 
different  kind  of  industry.  The  power  of  exchanging  the 
products  of  one  kind  of  labor  for  those  of  another,  is  a  condi¬ 
tion,  but  for  which,  there  would  almost  always  be  a  smaller 
quantity  of  labor  altogether.  When  a  new  market  is  opened 
for  any  product  of  industry,  and  a  greater  quantity  of  the  ar¬ 
ticle  is  consequently  produced,  the  increased  production  is 
not  always  obtained  at  the  expense  of  some  other  product ;  it 
is  often  a  new  creation,  the  result  of  labor  which  would  other¬ 
wise  have  remained  unexerted ;  or  of  assistance  rendered  to 
labor  by  improvements  or  by  modes  of  co-operation  to  which 
recourse  would  not  have  been  had  if  an  inducement  had  not 
been  offered  for  raising  a  larger  produce. 

§  3.  From  these  considerations  it  appears  that  a  country 
will  seldom  have  a  productive  agriculture,  unless  it  has  a  large 
town  population,  or  the  only  available  substitute,  a  large  ex¬ 
port  trade  in  agricultural  produce  to  supply  a  population  else¬ 
where.  I  use  the  phrase  town  population  for  shortness,  to 
imply  a  population  non-agricultural ;  which  will  generally  be 
collected  in  towns  or  large  villages,  for  the  sake  of  combination 
of  labor.  The  application  of  this  truth  by  Mr.  Wakefield  to  the 
theory  of  colonization,  has  excited  much  attention,  and  is 
doubtless  destined  to  excite  much  more.  It  is  one  of  those 
great  practical  discoveries,  which,  once  made,  appear  so  obvious 
that  the  merit  of  making  them  seems  less  than  it  is.  Mr.  Wake¬ 
field  was  the  first  to  point  out  that  the  mode  of  planting  new 
settlements,  then  commonly  practised — setting  down  a  number 
of  families  side  by  side,  each  on  its  piece  of  land,  all  employing 
themselves  in  exactly  the  same  manner, — though  in  favorable 
circumstances  it  may  assure  to  those  families  a  rude  abundance 
of  mere  necessaries,  can  never  be  other  than  unfavorable  to 
great  production  or  rapid  growth :  and  his  system  consists  of 
arrangements  for  securing  that  every  colony  shall  have  from 
the  first  a  town  population,  bearing  due  proportion  to  its  agri¬ 
cultural,  and  that  the  cultivators  of  the  soil  shall  not  be  so 
widely  scattered  as  to  be  deprived  by  distance,  of  the  benefit  of 
that  town  population  as  a  market  for  their  produce.  The  prin¬ 
ciple  on  which  the  scheme  is  founded,  does  not  depend  on  any 
theory  respecting  the  superior  productiveness  of  land  held  in 


COMBINATION  OF  LABOR 


119 

large  portions,  and  cultivated  by  hired  labor.  Supposing  it 
true  that  land  yields  the  greatest  produce  when  divided  into 
small  properties  and  cultivated  by  peasant  proprietors,  a  town 
population  would  be  just  as  necessary  to  induce  those  proprie¬ 
tors  to  raise  that  larger  produce :  and  if  they  were  too  far  from 
the  nearest  seat  of  non-agricultural  industry  to  use  it  as  a 
market  for  disposing  of  their  surplus,  and  thereby  supplying 
their  other  wants,  neither  that  surplus  nor  any  equivalent  for 
it  would,  generally  speaking,  be  produced. 

It  is,  above  all,  the  deficiency  of  town  population  which 
limits  the  productiveness  of  the  industry  of  a  country  like 
India.  The  agriculture  of  India  is  conducted  entirely  on  the 
system  of  small  holdings.  There  is,  however,  a  considerable 
amount  of  combination  of  labor.  The  village  institutions  and 
customs,  which  are  the  real  framework  of  Indian  society,  make 
provision  for  joint  action  in  the  cases  in  which  it  is  seen  to  be 
necessary ;  or  where  they  fail  to  do  so,  the  government  (when 
tolerably  well  administered)  steps  in,  and  by  an  outlay  from  the 
revenue,  executes  by  combined  labor  the  tanks,  embankments, 
and  works  of  irrigation,  which  are  indispensable.  The  imple¬ 
ments  and  processes  of  agriculture  are,  however,  so  wretched, 
that  the  produce  of  the  soil,  in  spite  of  great  natural  fertility 
and  a  climate  highly  favorable  to  vegetation,  is  miserably 
small :  and  the  land  might  be  made  to  yield  food  in  abundance 
for  many  more  than  the  present  number  of  inhabitants,  without 
departing  from  the  system  of  small  holdings.  But  to  this  the 
stimulus  is  wanting,  which  a  large  town  population,  connected 
with  the  rural  districts  by  easy  and  unexpensive  means  of  com¬ 
munication,  would  afford.  That  town  population,  again,  does 
not  grow  up,  because  the  few  wants  and  unaspiring  spirit  of 
the  cultivators  (joined  until  lately  with  great  insecurity  of  prop¬ 
erty,  from  military  and  fiscal  rapacity)  prevent  them  from  at¬ 
tempting  to  become  consumers  of  town  produce.  In  these  cir¬ 
cumstances  the  best  chance  of  an  early  development  of  the 
productive  resources  of  India,  consists  in  the  rapid  growth  of 
its  export  of  agricultural  produce  (cotton,  indigo,  sugar,  cof¬ 
fee,  etc.)  to  the  markets  of  Europe.  The  producers  of  these 
articles  are  consumers  of  food  supplied  by  their  fellow-agri¬ 
culturists  in  India;  and  the  market  thus  opened  for  surplus 
food  will,  if  accompanied  by  good  government,  raise  up  by 
degrees  more  extended  wants  and  desires,  directed  either 


120 


POLITICAL  ECONOMY 


towards  European  commodities  or  towards  things  which  will 
require  for  their  production  in  India  a  larger  manufacturing 
population. 

§  4.  Thus  far  of  the  separation  of  employments,  a  form  of 
the  combination  of  labor  without  which  there  cannot  be  the 
first  rudiments  of  industrial  civilization.  But  when  this  separa¬ 
tion  is  thoroughly  established ;  when  it  has  become  the  general 
practice  for  each  producer  to  supply  many  others  with  one  com¬ 
modity,  and  to  be  supplied  by  others  with  most  of  the  things 
which  he  consumes ;  reasons  not  less  real,  though  less  impera¬ 
tive,  invite  to  a  further  extension  of  the  same  principle.  It  is 
found  that  the  productive  power  of  labor  is  increased  by  carry¬ 
ing  the  separation  further  and  further  ;  by  breaking  down  more 
and  more  every  process  of  industry  into  parts,  so  that  each 
laborer  shall  confine  himself  to  an  ever  smaller  number  of  sim¬ 
ple  operations.  And  thus,  in  time,  arise  those  remarkable  cases 
of  what  is  called  the  division  of  labor,  with  which  all  readers  on 
subjects  of  this  nature  are  familiar,  ftdam  Smith's  illustration 
from  j>in-making,  though  so  well  known,  is  so  much  to  the 
point,  that  I  wilT  venture  once  more  to  transcribe  it.  “  The 
business  of  making  a  pin  is  divided  into  about  eighteen  dis¬ 
tinct  operations.  One  man  draws  out  the  wire,  another 
straights  it,  a  third  cuts  it,  a  fourth  points  it,  a  fifth  grinds  it  at 
the  top  for  receiving  the  head ;  to  make  the  head  requires  two 
or  three  distinct  operations ;  to  put  it  on,  is  a  peculiar  busi¬ 
ness  ;  to  whiten  the  pins  is  another ;  it  is  even  a  trade  by  itself 
to  put  them  into  the  paper.  ...  I  have  seen  a  small  manu¬ 
factory  where  ten  men  only  were  employed,  and  where  some 
of  them,  consequently,  performed  two  or  three  distinct  opera¬ 
tions.  But  though  they  were  very  poor,  and  therefore  but  in¬ 
differently  accommodated  with  the  necessary  machinery,  they 
could,  when  they  exerted  themselves,  make  among  them  about 
twelve  pounds  of  pins  in  a  day.  There  are  in  a  pound  up¬ 
wards  of  four  thousand  pins  of  a  middling  size.  Those  ten  per¬ 
sons,  therefore,  could  make  among  them  upwards  of  forty- 
eight  thousand  pins  in  a  day.  Each  person,  therefore,  making 
a  tenth  part  of  forty-eight  thousand  pins,  might  be  considered 
as  making  four  thousand  eight  hundred  pins  in  a  day.  But 
if  they  had  all  wrought  separately  and  independently,  and  with¬ 
out  any  of  them  having  been  educated  to  this  peculiar  business, 
they  certainly  could  not  each  of  them  have  made  twenty,  per¬ 
haps  not  one  pin  in  a  day.” 


COMBINATION  OF  LABOR 


I  2  I 


jM.^Say  furnishes  a  still  stronger  example  of  the  effects  of  di¬ 
vision  of  labor — from  a  not  very  important  branch  of  industry 
certainly,  the  manufacture  of  playing  cards^  “  It  is  said  by 
those  engaged  in  the  business,  that  each  card,  that  is,  a  piece 
of  pasteboard  of  the  size  of  the  hand,  before  being  ready  for 
sale,  does  not  undergo  fewer  than  seventy  operations,  every 
one  of  which  might  be  the  occupation  of  a  distinct  class  of 
workmen.  And  if  there  are  not  severity  classes  of  work-people 
in  each  card  manufactory,  it  is  because  the  division  of  labor  is 
not  carried  so  far  as  it  might  be ;  because  the  same  workman 
is  charged  with  two,  three,  or  four  distinct  operations.  The  in¬ 
fluence  of  this  distribution  of  employments  is  immense.  I  have 
seen  a  card  manufactory  where  thirty  workmen  produced  daily 
fifteen  thousand  five  hundred  cards,  being  above  five  hundred 
cards  for  each  laborer ;  and  it  may  be  presumed  that  if  each 
of  these  workmen  were  obliged  to  perform  all  the  operations 
himself,  even  supposing  him  a  practised  hand,  he  would  not 
perhaps  complete  two  cards  in  a  day :  and  the  thirty  workmen, 
instead  of  fifteen  thousand  five  hundred  cards,  would  make 
only  sixty.”  * 

In  watchmaking1, .  as  Mr.  Babbage  observes,  “  it  was  stated 
in  evidence  before  a  Committee  of  the  House  of  Commons,  that 
there  are  a  feundred  and  two  distinct  branches  of  this  art,  to 
each  of  which  a  boy  may  be  put  apprentice ;  and  that  he  only 
learns  his  master’s  department,  and  is  unable,  after  his  appren¬ 
ticeship  has  expired,  without  subsequent  instruction,  to  work 
at  any  other  branch.  The  watch-finisher,  whose  business  it  is 
to  put  together  the  scattered  parts,  is  the  only  one,  out  of  the 
one  hundred  and  two  persons,  who  can  work  in  any  other  de¬ 
partment  than  his  own.”  f 

§  5.  The  causes  of  the  increased  efficiency  given  to  labor  by 
the  division  of  employments  are  some  of  them  too  familiar  to 
require  specification ;  but  it  is  worth  while  to  attempt  a  com¬ 
plete  enumeration  of  them.  By  Adam  Smith  they  are  reduced 
to  three.  “  J7irst?  the  increase  of  dexterity  in  every  particular 
workman  ;  secondly,  the  saving  of  the  time  which  is  commonly 
lost  in  passing  from  one  species  of  work  to  another ;  and  lastly, 


*  Say,  “  Cours  d’Economie  Politique 
Pratique,”  vol.  i.  p.  340. 

It  is  a  remarkable  proof  of  the  econ¬ 
omy  of  labor  occasioned  by  this  minute 
division  of  occupations,  that  an  article, 


the  production  of  which  is  the  result  of 
such  a  multitude  of  manual  operations, 
can  be  sold  for  a  trifling  sum. 

t  “  Economy  of  Machinery  and  Man¬ 
ufactures,”  3d  Edition,  p.  201. 


122 


POLITICAL  ECONOMY 


the  invention  of  a  great  number  oLmachines  which  facilitate 
and  abridge  labor,  and  enable  one  man  to  do  the  work  of 
many.” 

Of  these,  the  increase  of  dexterity  of  the  individual  workman 
is  the  most  obvious  and  universal.  It  does  not  follow  that  be¬ 
cause  a  thing  has  been  done  oftener  it  will  be  done  better.  That 
depends  on  the  intelligence  of  the  workman,  and  on  the  degree 
in  which  his  mind  works  along  with  his  hands.  But  it  will  be 
done  more  easily.  The  organs  themselves  acquire  gi  eater 
power :  the  muscles  employed  grow  stronger  by  frequent  ex¬ 
ercise,  the  sinews  more  pliant,  and  the  mental  powers  more 
efficient,  and  less  sensible  of  fatigue.  What  can  be  done  easily 
has  at  least  a  better  chance  of  being  done  well,  and  is  sure  to 
be  done  more  expeditiously.  What  was  at  first  done  slowly 
comes  to  be  done  quickly ;  what  was  at  first  done  slowly  with 
accuracy  is  at  last  done  quickly  with  equal  accuracy.  This  is 
as  true  of  mental  operations  as  of  bodily.  Even  a  child,  after 
much  practice,  sums  up  a  column  of  figures  with  a  rapidity 
which  resembles  intuition.  The  act  of  speaking  any  language, 
of  reading  fluently,  or  playing  music  at  sight,  are  cases  as  re¬ 
markable  as  they  are  familiar.  Among  bodily  acts,  dancing, 
gymnastic  exercises,  ease  and  brilliancy  of  execution  on  a  mu¬ 
sical  instrument,  are  examples  of  the  rapidity  and  facility  ac¬ 
quired  by  repetition.  In  simpler  manual  operations,  the  effect 
is  of  course  still  sooner  produced.  “  The  rapidity,”  Adam 
Smith  observes,  “  with  which  some  of  the  operations  of  certain 
manufactures  are  performed,  exceeds  what  the  human  hand 
could,  by  those  who  have  never  seen  them,  be  supposed  capable 
of  acquiring.”  *  This  skill  is,  naturally,  attained  after  shorter 
practice,  in  proportion  as  the  division  of  labor  is  more  minute ; 
and  will  not  be  attained  in  the  same  degree  at  all,  if  the  work¬ 
man  has  a  greater  variety  of  operations  to  execute  than  allows 
of  a  sufficiently  frequent  repetition  of  each.  The  advantage  is 
not  confined  to  the  greater  efficiency  ultimately  attained,  but 


*  “  In  astronomical  observations,  the 
senses  of  the  operator  are  rendered  so 
acute  by  habit,  that  he  can  estimate  dif¬ 
ferences  of  time  to  the  tenth  of  a  second; 
and  adjust  his  measuring  instrument  to 
graduations  of  which  five  thousand  oc¬ 
cupy  only  an  inch.  It  is  the  same 
throughout  the  commonest  processes  of 
manufacture.  A  child  who  fastens  on 
the  heads  of  pins  will  repeat  an  opera¬ 
tion  requiring  several  distinct  motions 


of  the  muscles  one  hundred  times  a 
minute  for  several  successive  hours.  In 
a  recent  Manchester  paper  it  was  stated 
that  a  peculiar  sort  of  twist  or  *  gimp/ 
which  cost  three  shillings  making  when 
first  introduced,  was  now  manufactured 
for  one  penny;  and  this  not,  as  usually, 
by  the  invention  of  a  new  machine,  but 
solely  through  the  increased  dexterity 
of  the  workman.” — “  Edinburgh  Re¬ 
view  ”  for  January,  1849,  p.  81. 


COMBINATION  OF  LABOR 


123 


includes  also  the  diminished  loss  of  time,  and  waste  of  material, 
in  learning  the  art.  “  A  certain  quantity  of  material,”  says  Mr. 
Babbage,f  “will  in  all  cases  be  consumed  unprofitably,  or 
spoiled,  by  every  person  who  learns  an  art ;  and  as  he  applies 
himself  to  each  new  process,  he  will  waste  some  of  the  raw  ma¬ 
terial,  or  of  the  partly  manufactured  commodity.  But  if  each 
man  commits  this  waste  in  acquiring  successively  every  proc¬ 
ess,  the  quantity  of  waste  will  be  much  greater  than  if  each  per¬ 
son  confine  his  attention  to  one  process.”  And  in  general  each 
will  be  much  sooner  qualified  to  execute  his  one  process,  if  he 
be  not  distracted  while  learning  it,  by  the  necessity  of  learning 
others. 

The  second  advantage  enumerated  by  Adam  Smith  as  aris¬ 
ing  from  the  division  of  labor,  is  one  on  which  I  cannot  help 
thinking  that  more  stress  is  laid  by  him  and  others  than  it  de¬ 
serves.  To  do  full  justice  to  his  opinion,  I  will  quote  his  own 
exposition  of  it.  “  The  advantage  which  is  gained  by  saving 
the  time  commonly  lost  in  passing  from  one  sort  of  work  to 
another,  is  much  greater  than  we  should  at  first  view  be  apt 
to  imagine  it.  It  is  impossible  to  pass  very  quickly  from  one 
kind  of  work  to  another,  that  is  carried  on  in  a  different  place, 
and  with  quite  different  tools.  A  country  weaver,  who  culti¬ 
vates  a  small  farm,  must  lose  a  good  deal  of  time  in  passing 
from  his  loom  to  the  field,  and  from  the  field  to  his  loom.  When 
the  two  trades  can  be  carried  on  in  the  same  workhouse,  the 
loss  of  time  is  no  doubt  much  less.  It  is  even  in  this  case, 
however,  very  considerable.  A  man  commonly  saunters  a  lit¬ 
tle  in  turning  his  hand  from  one  sprt  of  employment  to  another. 
When  he  first  begins  the  new  work,  he  is  seldom  very  keen  and 
hearty ;  his  mind,  as  they  say,  does  not  go  to  it,  and  for  some 
time  he  rather  trifles  than  applies  to  good  purpose.  The  habit 
of  sauntering  and  of  indolent  careless  application,  which  is 
naturally,  or  rather  necessarily  acquired  by  every  country 
workman  who  is  obliged  to  change  his  work  and  his  tools 
every  half  hour,  and  to  apply  his  hand  in  twenty  different  ways 
almost  every  day  of  his  life,  renders  him  almost  always  sloth¬ 
ful  and  lazy,  and  incapable  of  any  vigorous  application  even 
on  the  most  pressing  occasions.”  This  is  surely  a  most  exag¬ 
gerated  description  of  the  inefficiency  of  country  labor,  where 
it  has  any  adequate  motive  to  exertion.  Few  workmen  change 

t  Page  171.. 


124  POLITICAL  ECONOMY 

their  work  and  their  tools  oftener  than  a  gardener ;  is  he  usually 
incapable  of  vigorous  application?  Many  of  the  higher  de¬ 
scription  of  artisans  have  to  perform  a  great  multiplicity  of 
operations  with  a  variety  of  tools.  They  do  not  execute  each 
of  these  with  the  rapidity  with  which  a  factory  workman  per¬ 
forms  his  single  operation ;  but  they  are,  except  in  a  merely 
manual  sense,  more  skilful  laborers,  and  in  all  senses  whatever 
more  energetic. 

Mr.  Babbage,  following  in  the  track  of  Adam  Smith,  says, 
“When  the  human  hand,  or  the  human  head,  has  been  for  some 
time  occupied  in  any  kind  of  work,  it  cannot  instantly  change 
its  employment  with  full  effect.  The  muscles  of  the  limbs  em¬ 
ployed  have  acquired  a  flexibility  during  their  exertion,  and 
those  not  in  action  a  stiffness  during  rest,  which  render  every 
change  slow  and  unequal  in  the  commencement.  Long  habit 
also  produces  in  the  muscles  exercised  a  capacity  for  enduring 
fatigue  to  a  much  greater  degree  than  they  could  support  under 
other  circumstances.  A  similar  result  seems  to  take  place  in 
any  change  of  mental  exertion ;  the  attention  bestowed  on  the 
new  subject  not  being  so  perfect  at  first  as  it  becomes  after 
some  exercise.  The  employment  of  different  tools  in  the  suc¬ 
cessive  processes,  is  another  cause  of  the  loss  of  time  in  chang¬ 
ing  from  one  operation  to  another.  If  these  tools  are  simple, 
and  the  change  is  not  frequent,  the  loss  of  time  is  not  consider¬ 
able  ;  but  in  many  processes  of  the  arts,  the  tools  are  of  great 
delicacy,  requiring  accurate  adjustment  every  time  they  are 
used  ;  and  in  many  cases,  the  time  employed  in  adjusting  bears 
a  large  proportion  to  that  employed  in  using  the  tool.  The 
sliding-rest,  the  dividing  and  the  drilling  engine  are  of  this 
kind :  and  hence,  in  manufactories  of  sufficient  extent,  it  is 
found  to  be  good  economy  to  keep  one  machine  constantly  em¬ 
ployed  in  one  kind  of  work :  one  lathe,  for  example,  having  a 
screw  motion  to  its  sliding-rest  along  the  whole  length  of  its 
bed,  is  kept  constantly  making  cylinders ;  another,  having  a 
motion  for  equalizing  the  velocity  of  the  work  at  the  point  at 
which  it  passes  the  tool,  is  kept  for  facing  surfaces ;  whilst  a 
third  is  constantly  employed  in  cutting  wheels.” 

I  am  very  far  from  implying  that  these  different  considera¬ 
tions  are  of  no  weight ;  but  I  think  there  are  counter-consid¬ 
erations  which  are  overlooked.  If  one  kind  of  muscular  or 
mental  labor  is  different  from  another,  for  that  very  reasoix 


COMBINATION  OF  LABOR 


I25 


it  is  to  some  extent  a  rest  from  that  other ;  and  if  the  greatest 
vigor  is  not  at  once  obtained  in  thg  second  occupation t  neither 
could  the  tirst  have  been  indefinitely  prolonged  without  some 
Eelaxation  of  energy.  It  is  a  matter  of  common  experience 
"that  a  change  of  occupation  will  often  afford  relief  where  com¬ 
plete  repose  would  otherwise  be  necessary,  and  that  a  person 
can  work  many  more  hours  without  fatigue  at  a  succession  of 
occupations,  than  if  confined  during  the  whole  time  to  one. 
Different  occupations  employ  different  muscles,  or  different 
energies  of  the  mind,  some  of  which  rest  and  are  refreshed 
\yhile  others  work,  bodily  labor  itself  rests  from  mental,  and 
conversely.  The  variety  itself  has  an  invigorating  effect  on 
what,  for  want  of  a  more  philosophical  appellation,  we  must 
term  the  animal  spirits ;  so  important  to  the  efficiency  of  all 
work  not  mechanical,  and  not  unimportant  even  to  that.  The 
comparative  weight  due  to  these  considerations  is  different 
with  different  individuals  ;  some  are  more  fitted  than  others  for 
persistency  in  one  occupation,  and  less  fit  for  change ;  they 
require  longer  to  get  the  steam  up  (to  use  a  metaphor  now 
common) ;  the  irksomeness  of  setting  to  work  lasts  longer, 
and  it  requires  more  time  to  bring  their  faculties  into  full  play, 
and  therefore  when  this  is  once  done,  they  do  not  like  to  leave 
off,  but  go  on  long  without  intermission,  even  to  the  injury 
of  their  health.  Temperament  has  something  to  do  with  these 
differences.  There  are  people  whose  faculties  seem  by  nature 
to  come  slowly  into  action,  and  to  accomplish  little  until  they 
have  been  a  long  time  employed.  Others,  again,  get  into  ac¬ 
tion  rapidly,  but  cannot,  without  exhaustion,  continue  long. 
In  this,  however,  as  in  most  other  things,  though  natural  dif¬ 
ferences  are  something,  habit  is  much  more.  The  habit  of 
passing  rapidly  from  one  occupation  to  another  may  be  ac¬ 
quired,  like  other  habits,  by  early  cultivation ;  and  when  it  is 
acquired,  there  is  none  of  the  sauntering  which  Adam  Smith 
speaks  of,  after  each  change ;  no  want  of  energy  and  interest, 
but  the  workman  comes  to  each  part  of  his  occupation  with  a 
freshness  and  a  spirit  which  he  does  not  retain  if  he  persists  in 
any  one  part  (unless  in  case  of  unusual  excitement)  beyond  the 
length  of  time  to  which  he  is  accustomed.  Women  are  usually 
(at  least  in  their  present  social  circumstances)  of  far  greater 
versatility  than  men ;  and  the  present  topic  is  an  instance 
among  multitudes,  how  little  the  ideas  and  experience  of  worn- 


126 


POLITICAL  ECONOMY 


en  have  yet  counted  for,  in  forming  the  opinions  of  mankind. 
There  are  few  women  who  would  not  reject  the  idea  that  work 
is  made  vigorous  by  being  protracted,  and  is  inefficient  for 
some  time  after  changing  to  a  new  thing.  Even  in  this  case, 
habit,  I  believe,  much  more  than  nature,  is  the  cause  of  the 
difference.  The  occupations  of  nine  out  of  every  ten  men  are 
special,  those  of  nine  out  of  every  ten  women  general,  embrac¬ 
ing  a  multitude  of  details,  each  of  which  requires  very  little 
time.  Women  are  in  the  constant  practice  of  passing  quickly 
from  one  manual,  and  still  more  from  one  mental,  operation  to 
another,  which  therefore  rarely  costs  them  either  effort  or  loss 
of  time,  while  a  man’s  occupation  generally  consists  in  work¬ 
ing  steadily  for  a  long  time  at  one  thing,  or  one  very  limited 
class  of  things.  But  the  situations  are  sometimes  reversed,  and 
with  them  the  characters.  Women  are  not  found  less  efficient 
than  men  for  the  uniformity  of  factory  work,  or  they  would 
not  so  generally  be  employed  for  it ;  and  a  man  who  has  cul¬ 
tivated  the  habit  of  turning  his  hand  to  many  things,  far  from 
being  the  slothful  and  lazy  person  described  by  Adam  Smith, 
is  usually  remarkably  lively  and  active.  It  is  true,  however, 
that  change  of  occupation  may  be  too  frequent  even  for  the 
most  versatile.  Incessant  variety  is  even  more  fatiguing  than 
perpetual  sameness. 

The  third  advantage  attributed  by  Adam  Smith  to  the  divi¬ 
sion  of  labor,  is,  to  a  certain  extent,  real.  Inventions  tending 
to  save  labor  in  a  particular  operation,  are  more  likely  to  occur 
to  any  one  in  proportion  as  his  thoughts  are  intensely  directed 
to  that  occupation,  and  continually  employed  upon  it.  A  per¬ 
son  is  not  so  likely  to  make  practical  improvements  in  one  de¬ 
partment  of  things,  whose  attention  is  very  much  diverted  to 
others.  But,  in  this,  much  more  depends  on  general  intelli¬ 
gence  and  habitual  activity  of  mind,  than  on  exclusiveness  of 
occupation ;  and  if  that  exclusiveness  is  carried  to  a  degree 
unfavorable  to  the  cultivation  of  intelligence,  there  will  be 
more  lost  in  this  kind  of  advantage  than  gained.  We  may  add, 
that  whatever  may  be  the  cause  of  making  inventions,  when 
they  are  once  made,  the  increased  efficiency  of  labor  is  owing 
to  the  invention  itself,  and  not  to  the  division  of  labor. 

,Tlie  greatest  advantage  (next  to  the  dexterity  wnrk- 

men)  derived  from  the  minute  division  of  labor  which_takes 


COMBINATION  OF  LABOR 


127 


by  Adam  Smith,  but  to  which  attention  has  been  drawn  bv  Mr. 
Babbage ;  the  more  economical  distribution  of  labor,  bvclass-^ 
ing  the~ work-people  according  to  their  capacity.  Different 
parts  of  the  same  series  of  operations  require  unequal  degrees 
of  skill  and  bodily  strength ;  and  those  who  have  skill  enough 
for  the  most  difficult,  or  strength  enough  for  the  hardest  parts 
of  the  labor,  are  made  much  more  useful  by  being  employed 
solely  in  them ;  the  operations  which  everybody  is  capable  of, 
being  left  to  those  who  are  fit  for  no  others.  Production  is 
most  efficient  when  the  precise  quantity  of  skill  and  strength, 
which  is  required  for  each  part  of  the  process,  is  employed  in 
it,  and  no  more.  The  operation  of  pin-making  requires,  it 
seems,  in  its  different  parts,  such  different  degrees  of  skill,  that 
the  wages  earned  by  the  persons  employed  vary  from  four- 
pence  halfpenny  a  day  to  six  shillings ;  and  if  the  workman 
who  is  paid  at  that  highest  rate  had  to  perform  the  whole 
process,  he  would  be  working  a  part  of  his  time  with  a  waste 
per  day  equivalent  to  the  difference  between  six  shillings  and 
fourpence  halfpenny.  Without  reference  to  the  loss  sustained 
in  quantity  of  work  done,  and  supposing  even  that  he  could 
make  a  pound  of  pins  in  the  same  time  in  which  ten  workmen 
combining  their  labor  can  make  ten  pounds,  Mr.  Babbage  com¬ 
putes  that  they  would  cost,  in  making,  three  times  and  three- 
quarters  as  much  as  they  now  do  by  means  of  the  division  of 
labor.  In  needle-making,  he  adds,  the  difference  would  be  still 
greater,  for  in  that,  the  scale  of  remuneration  for  different  parts 
of  the  process  varies  from  sixpence  to  twenty  shillings  a  day. 

To  the  advantage  which  consists  in  extracting  the  greatest 
possible  amount  of  utility  from  skill,  may  be  added  the  anal¬ 
ogous  one,  of  extracting  the  utmost  possible  utility  from  tools. 
“  If  anv  man,”  says  an  able  writer,*  “  had  all  the  tools  which 
many  different  occupations  require,  at  least  tliree-fourths  M 
them  would  constantly  be  idle  and  useless.  It  were  clearly- then 
Better,  were  any  society  to  exist  where~each  man  had  all  these 
tools,  and  alternately  carried  on  each  of  these  occupations,  that 
the  members  of  it  should,  if  possible,  divide  them  amongst 
them,  each  restricting  himself  to  some  particular  employment. 
The  advantages  of  the  change  to  the  whole  community,  and 
therefore  to  every  individual  in  it,  are  great.  In  the  first  place, 

*  “  Statement  of  some  New  Principles  on  the  Subject  of  Political  Economy,” 
by  John  Rae  (Boston,  U.  S.),  p.  164. 


128 


POLITICAL  ECONOMY 


the  various  implements,  being  in  constant  employment,  yield 
a  better  return  for  what  has  been  laid  out  in  procuring  them. 
In  consequence  their  owners  can  afford  to  have  them  of  better 
quality  and  more  complete  construction.  The  result  of  both 
events  is,  that  a  larger  provision  is  made  for  the  future  wants 
of  the  whole  society.’' 

§  6.  The  division  of  labor,  as  all  writers  on  the  subject  have 
remarked,  is  limited  by  the  extent  of  the  market.  If,  by  the 
separation  of  pin-making  into  ten  distinct  employments,  forty- 
eight  thousand  pins  can  be  made  in  a  day,  this  separation  will 
only  be  advisable  if  the  number  of  accessible  consumers  is  such 
as  to  require,  every  day,  something  like  forty-eight  thousand 
pins.  If  there  is  only  a  demand  for  twenty-four  thousand,  the 
division  of  labor  can  only  be  advantageously  carried  to  the  ex¬ 
tent  which  will  every  day  produce  that  smaller  number.  This, 
therefore,  is  a  further  mode  in  which  an  accession  of  demand 
for  a  commodity  tends  to  increase  the  efficiency  of  the  labor 
employed  in  its  production.  The  extent  of  the  market  may  be 
limited  by  several  causes  :  too  small  a  population  ;  the  popula¬ 
tion  too  scattered  and  distant  to  be  easily  accessible ;  deficiency 
of  roads  and  water  carriage ;  or,  finally,  the  population  too 
poor,  that  is,  their  collective  labor  too  little  effective,  to  admit 
of  their  being  large  consumers.  Indolence,  want  of  skill,  and 
want  of  combination  of  labor,  among  those  who  would  other¬ 
wise  be  buyers  of  a  commodity,  limit,  therefore,  the  practicable 
amount  of  combination  of  labor  among  its  producers.  In  an 
early  stage  of  civilization,  when  the  demand  of  any  particular 
locality  was  necessarily  small,  industry  only  flourished  among 
those  who  by  their  command  of  the  sea-coast  or  of  a  navigable 
river,  could  have  the  whole  world,  or  all  that  part  of  it  which 
lay  on  coasts  or  navigable  rivers,  as  a  market  for  their  produc¬ 
tions.  The  increase  of  the  general  riches  of  the  world,  when 
accompanied  with  freedom  of  commercial  intercourse,  im¬ 
provements  in  navigation,  and  inland  communication  by  roads, 
canals,  or  railways,  tends  to  give  increased  productiveness  to 
the  labor  of  every  nation  in  particular,  by  enabling  each  locality 
to  supply  with  its  special  products  so  much  larger  a  market, 
that  a  great  extension  of  the  division  of  labor  in  their  produc¬ 
tion  is  an  ordinary  consequence. 

The  division  of  labor  is  also  limited,  in  many  cases,  by  the 

^ — 1»  i  lur  i  f  ■ — , — , — ■■■-■  ■«! — 

nature  of  Ihc  employment.  Agriculture,  for  example,  is  not 


PRODUCTION  ON  A  LARGE  AND  SMALL  SCALE  129 


susceptible  of  so  great  a  division  of  occupation  as  many 
branches  of  manufactures,  because  its  different  operations  can¬ 
not  possibly  be  simultaneous.  One  man  cannot  be  always 
ploughing,  another  sowing,  and  another  reaping.  A  work¬ 
man  who  only  practised  one  agricultural  operation  would  be 
idle  eleven  months  of  the  year.  The  same  person  may  per¬ 
form  them  all  in  succession,  and  have,  in  most  climates,  a  con¬ 
siderable  amount  of  unoccupied  time.  To  execute  a  great 
agricultural  improvement,  it  is  often  necessary  that  many  labor¬ 
ers  should  work  together ;  but  in  general,  except  the  few  whose 
business  is  superintendence,  they  all  work  in  the  same  manner. 

A  canal  or  a  railwav  embankment  cannot  be  made  without  a 

•/ 

combination  of  many  laborers ;  but  they  are  all  excavators, 
except  the  engineer  and  a  few  clerks. 

Chapter  IX. — Of  Production  on  a  Large,  and  Production  on  a 

Small  Scale 

§  1.  From  the  importance  of  combination  of  labor,  it  is  an 
obvious  conclusion,  that  foere  are  many  cases  in  which  produc¬ 
tion  is  made  much  more  effective  by  being  conducted  on  a  large 
scale.  Whenever  it  is  essential  to  the  greatest  efficiency  of 

labor  that  many  laborers  should  combine,  even  though  only 
in  the  way  of  Simple  Co-operation,  the  scale  of  the  enterprise 
must  be  such  as  to  bring  many  laborers  together,  and  the  cap¬ 
ital  must  be  large  enough  to  maintain  them.  Still  more  need¬ 
ful  is  this  when  the  nature  of  the  employment  allows,  and  the 
extent  of  the  possible  market  encourages,  a  considerable  divi¬ 
sion  of  labor.  The  larger  the  enterprise,  the  further  the  divi¬ 
sion  of  labor  may  be  carrie^d.  This  is  one  of  the  principal 
causes  of  large  manufactories.  Even  when  no  additional  sub¬ 
division  of  the  work  would  follow  an  enlargement  of  the  opera¬ 
tions,  there  will  be  good  economy  in  enlarging  them  to  the 
point  at  which  every  person  to  whom  it  is  convenient  to  assign 
a  special  occupation,  will  have  full  employment  in  that  occupa¬ 
tion.  This  point  is  well  illustrated  by  Mr.  Babbage :  * 

“  If  machines  be  kept  working  through  the  twenty-four 
hours,’’  (which  is  evidently  the  only  economical  mode  of  em¬ 
ploying  them)  “  it  is  necessary  that  some  person  shall  attend 
to  admit  the  workmen  at  the  time  they  relieve  each  other;  and 

*  Page  214  et  seqq. 

VOL.  I. — 9 


130 


POLITICAL  ECONOMY 


whether  the  porter  or  other  servant  so  employed  admit  one 
person  or  twenty,  his  rest  will  be  equally  disturbed.  It  will 
also  be  necessary  occasionally  to  adjust  or  repair  the  machine ; 
and  this  can  be  done  much  better  by  a  workman  accustomed 
to  machine-making,  than  by  the  person  who  uses  it.  Now, 
since  the  good  performance  and  the  duration  of  machines  de¬ 
pend,  to  a  very  great  extent,  upon  correcting  every  shake  or 
imperfection  in  their  parts  as  soon  as  it  appears,  the  prompt 
attention  of  a  workman  resident  on  the  spot  will  considerably 
reduce  the  expenditure  arising  from  the  wear  and  tear  of  the 
machinery.  But  in  the  case  of  a  single  lace-frame,  or  a  single 
loom,  this  would  be  too  expensive  a  plan.  Here  then  arises  an¬ 
other  circumstance  which  tends  to  enlarge  the  extent  of  a 
factory.  It  ought  to  consist  of  such  a  number  of  machines  as 
shall  occupy  the  whole  time  of  one  workman  in  keeping  them 
in  order :  if  extended  beyond  that  number,  the  same  principle 
of  economy  would  point  out  the  necessity  of  doubling  or  trip¬ 
ling  the  number  of  machines,  in  order  to  employ  the  whole  time 
of  two  or  three  skilful  workmen. 

“  When  one  portion  of  the  workman’s  labor  consists  in  the 
exertion  of  mere  physical  force,  as  in  weaving,  and  in  many 
similar  arts,  it  will  soon  occur  to  the  manufacturer,  that  if  that 
part  were  executed  by  a  steam-engine,  the  same  man  might, 
in  the  case  of  weaving,  attend  to  two  or  more  looms  at  once : 
and,  since  we  already  suppose  that  one  or  more  operative  en¬ 
gineers  have  been  employed,  the  number  of  looms  may  be 
so  arranged  that  their  time  shall  be  fully  occupied  in  keeping 
the  steam  engine  and  the  looms  in  order. 

“  Pursuing  the  same  principles,  the  manufactory  becomes 
gradually  so  enlarged,  that  the  expense  of  lighting  during  the, 
night  amounts  to  a  considerable  sum :  and  as  there  are  already 
attached  to  the  establishment  persons  who  are  up  all  night,  and 
can  therefore  constantly  attend  to  it,  and  also  engineers  to 
make  and  keep  in  repair  any  machinery,  the  addition  of  an 
apparatus  for  making  gas  to  light  the  factory  leads  to  a  new 
extension,  at  the  same  time  that  it  contributes,  by  diminish¬ 
ing  the  expense  of  lighting,  and  the  risk  of  accidents  from  fire, 
to  reduce  the  cost  of  manufacturing. 

“  Long  before  a  factory  has  reached  this  extent,  it  will  have 
been  found  necessary  to  establish  an  accountant’s  department, 
with  clerks  to  pay  the  workmen,  and  to  see  that  they  arrive 


PRODUCTION  ON  A  LARGE  AND  SMALL  SCALE  131 


at  their  stated  times ;  and  this  department  must  be  in  commu¬ 
nication  with  the  agents  who  purchase  the  raw  produce,  and 
with  those  who  sell  the  manufactured  article/’  It  will  cost 
these  clerks  and  accountants  little  more  time  and  trouble  to 
pay  a  large  number  of  workmen  than  a  small  number :  to  check 
the  accounts  of  large  transactions,  than  of  small.  If  the  busi¬ 
ness  doubled  itself,  it  would  probably  be  necessary  to  increase,  * 
but  certainly  not  to  double,  the  number  either  of  accountants, 
or  of  buying  and  selling  agents.  Every  increase  of  business 
would  enable  the  whole  to  be  carried  on  with  a  proportionally 
smaller  amount  of  labor. 

As  a  general  rule,  the  expenses  of  a  business  do  not  increase 
by  any  means  proportionally  to  the  quantity  of  business.  Let 
us  take  as  an  example,  a  set  of  operations  which  we  are  accus¬ 
tomed  to  see  carried  on  by  one  great  establishment,  that  of  the 
Post  Office.  Suppose  that  the  business,  let  us  say  only  of  the 
London  letter-post,  instead  of  being  centralized  in  a  single  con¬ 
cern,  were  divided  among  five  or  six  competing  companies. 
Each  of  these  would  be  obliged  to  maintain  almost  as  large  an 
establishment  as  is  now  sufficient  for  the  whole.  Since  each 
must  arrange  for  receiving  and  delivering  letters  in  all  parts  of 
the  town,  each  must  send  letter-carriers  into  every  street,  and 
almost  every  alley,  and  this  too  as  many  times  in  the  day  as  is 
now  done  by  the  Post  Office,  if  the  service  is  to  be  as  well  per¬ 
formed.  Each  must  have  an  office  for  receiving  letters  in  every 
neighborhood,  with  all  subsidiary  arrangements  for  collecting 
the  letters  from  the  different  offices  and  redistributing  them. 
To  this  must  be  added  the  much  greater  number  of  superior 
officers  who  would  be  required  to  check  and  control  the  sub¬ 
ordinates,  implying  not  only  a  greater  cost  in  salaries  for  such 
responsible  officers,  but  the  necessity,  perhaps,  of  being  satis¬ 
fied  in  many  instances  with  an  inferior  standard  of  qualification, 
and  so  failing  in  the  object. 

Whether  or  not  the  advantages  obtained  by  operating  on  a 
large  scale  preponderate  in  any  particular  case  over  the  more 
watchful  attention,  and  greater  regard  to.,  minor  ami 

losses,  usually  found  in  small  establishments,  can  be  ascer¬ 
tained,  in  a  state  of  free  competition,  by  an  unfailing-  test. 
Wherever  there  are  large  and  small  establishments  in  the  same 
business,  that  one  of  the  two  which  in  existing  circumstances 

carries  on  the  production  at  greatest  advantage,  will  be  able  to 


i32 


POLITICAL  ECONOMY 


undersell  the  other.  The  power  of  permanently  underselling 
can  only,  'generally  speaking-,  be  derived  from  increased  effec- 
Tiveness  of  labor ;  and  this,  when  obtained  by  a  more  extended 
division  of  employment,  or  by  a  classification  tending  to  a  better 
economy  of  skill,  always  implies  a  greater  produce  from  the 
same  laborT  and  not  merely  the  same  produce  from  less  labour 
it  increases  not  the  surplus  only,  but  the  gross  ^produce  of  in¬ 
dustry.  If  an  increased  quantity  of  the  particular  article  is  not 
required,  and  part  of  the  laborers  in  consequence  lose  their  em¬ 
ployment,  the  capital  which  maintained  and  employed  them  is 
also  set  at  liberty ;  and  the  general  produce  of  the  country  is 
increased,  by  some  other  application  of  their  labor. 

Another  of  the  causes  of  large  manufactories,  however,  is 

the  introduction  of  processes  requiring  expensive  machinery. 
Expensive  machinery  supposes  a  large  capital ;  and  is  not  re¬ 
sorted  t(7except  wrtITThe  intention  of  producing,  and  the  hope 
of  selling,  as  much  of  the  article  as  comes  up  to  the  full  powers 
of  the  machine.  For  both  these  reasons,  wherever  costly  ma¬ 
chinery  is  used,  the  large  system  of  production  is  inevitable. 
But  the  power  of  underselling  is  not  in  this  case  so  unerring 
a  test  as  in  the  former,  of  the  beneficial  effect  on  the  total  pro¬ 
duction  of  the  community.  The  power  of  underselling  does  not 
depend  on  the  absolute  increase  of  produce,  but  on  its  bearing 
an  increased  proportion  to  the  expenses :  which,  as  was  shown 
in  a  former  chapter,*  it  may  do,  consistently  with  even  a 
diminution  of  the  gross  annual  produce.  By  the  adoption  of 
machinery,  a  circulating  capital,  which  was  perpetually  con¬ 
sumed  and  reproduced,  has  been  converted  into  a  fixed  capital, 
requiring  only  a  small  annual  expense  to  keep  it  up :  and  a 
much  smaller  produce  will  suffice  for  merely  covering  that  ex¬ 
pense,  and  replacing  the  remaining  circulating  capital  of  the 
producer.  The  machinery  therefore  might  answer  perfectly 
well  to  the  manufacturer,  and  enable  him  to  undersell  his  com¬ 
petitors,  though  the  effect  on  the  production  of  the  country 
might  be  not  an  increase  but  a  diminution.  It  is  true,  the  ar¬ 
ticle  will  be  sold  cheaper,  and  therefore,  of  that  single  article, 
there  will  probably  be  not  a  smaller,  but  a  greater  quantity 
sold ;  since  the  loss  to  the  community  collectively  has  fallen 
upon  the  work-people,  and  they  are  not  the  principal  custom¬ 
ers,  if  customers  at  all,  of  most  branches  of  manufacture.  But 


*  Supra,  chap.  vi.  p.  93,  94. 


PRODUCTION  ON  A  LARGE  AND  SMALL  SCALE  133 


though  that  particular  branch  of  industry  may  extend  itself,  it 
will  be  by  replenishing  its  diminished  circulating  capital  from 
that  of  the  community  generally ;  and  if  the  laborers  employed 
in  that  department  escape  loss  of  employment,  it  is  because  the 
loss  will  spread  itself  over  the  laboring  people  at  large.  If  any 
of  them  are  reduced  to  the  condition  of  unproductive  laborers, 
supported  by  voluntary  or  legal  charity,  the  gross  produce  of 
the  country  is  to  that  extent  permanently  diminished,  until 
the  ordinary  progress  of  accumulation  makes  it  up :  but  if  the 
condition  of  the  laboring  classes  enables  them  to  bear  a  tempo¬ 
rary  reduction  of  wages,  and  the  superseded  laborers  become 
absorbed  in  other  employments,  their  labor  is  still  productive, 
and  the  breach  in  the  gross  produce  of  the  community  is  re¬ 
paired,  though  not  the  detriment  to  the  laborers.  I  have  re¬ 
stated  this  exposition,  which  has  already  been  made  in  a  former 
place,  to  impress  more  strongly  the  truth,  that  a  mode  of  pro¬ 
duction  does  not  of  necessity  increase  the  productive  effect  of 
the  collective  labor  of  a  community,  because  it  enables  a  partic¬ 
ular  commodity  to  be  sold  cheaper.  The  one  consequence 
generally  accompanies  the  other,  but  not  necessarily.  I  will 
not  here  repeat  the  reasons  I  formerly  gave,  nor  anticipate 
those  which  will  be  given  more  fully  hereafter,  for  deeming  the 
exception  to  be  rather  a  case  abstractedly  possible,  than  one 
which  is  frequently  realized  in  fact. 

A  considerable  part  of  the  saving  of  labor  effected  by  sub¬ 
stituting  the  large  system  of  production  for  the  small,  is  the 
saving  in  the  labor  of  the  capitalists  themselves.  If  a  hundred 
producers  with  small  capitals  carry  on  separately  the  same 
business,  the  superintendence  of  each  concern  will  probably 
require  the  whole  attention  of  the  person  conducting  it,  suffi¬ 
ciently  at  least  to  hinder  his  time  or  thoughts  from  being  dis¬ 
posable  for  anything  else:  while  a  single  manufacturer  pos¬ 
sessing  a  capital  equal  to  the  sum  of  theirs,  with  ten  or  a  dozen 
clerks,  could  conduct  the  whole  of  their  amount  of  business, 
and  have  leisure  too  for  other  occupations.  The  small  capital¬ 
ist,  it  is  true,  generally  combines  with  the  business  of  direction 
some  portion  of  the  details,  which  the  other  leaves  to  his  sub¬ 
ordinates  :  the  small  farmer  follows  his  own  plough,  the  small 
tradesman  serves  in  his  own  shop,  the  small  weaver  plies  his 
own  loom.  But  in  this  very  union  of  functions  there  is,  in  a 
great  proportion  of  cases,  a  want  of  economy.  The  principal 


134 


POLITICAL  ECONOMY 


in  the  concern  is  either  wasting,  in  the  routine  of  a  business, 
qualities  suitable  for  the  direction  of  it,  or  he  is  only  fit  for  the 
former,  and  then  the  latter  will  be  ill  done.  I  must  observe 
however  that  I  do  not  attach,  to  this  saving  of  labor,  the  im¬ 
portance  often  ascribed  to  it.  There  is  undoubtedly  much  more 
labor  expended  in  the  superintendence  of  many  small  capitals 
than  in  that  of  one  large  capital.  For  this  labor  however  the 
small  producers  have  generally  a  full  compensation,  in  the  feel¬ 
ing  of  being  their  own  masters,  and  not  servants  of  an  em¬ 
ployer.  It  may  be  said,  that  if  they  value  this  independence 
they  will  submit  to  pay  a  price  for  it,  and  to  sell  at  the  reduced 
rates  occasioned  by  the  competition  of  the  great  dealer  or  man¬ 
ufacturer.  But  they  cannot  always  do  this  and  continue  to  gain 
a  living.  They  thus  gradually  disappear  from  society.  After 
having  consumed  their  little  capital  in  prolonging  the  unsuc¬ 
cessful  struggle,  they  either  sink  into  the  condition  of  hired 
laborers,  or  become  dependent  on  others  for  support. 

§  2.  Production  on  a  large  scale  is  greatly  promoted  by  the 
practice  of  forming  a  large  capital  by  the  combination  of  many 
small  contributions ;  or,  in  other  words,  by  the  formation  of 
joint  stock  companies.  The  advantages  of  the  joint  stock  prin¬ 
ciple  are  numerous  and  important. 

In  the  first  place,  many  undertakings  require  an  amount  of 
capital  bevond  the  means  of  the  richest  individual  or  private 
partnership.  No  individual  could  have  made  a  railway  from 
London  to  Liverpool ;  it  is  doubtful  if  any  individual  could 
even  work  tfieTraffic  on  it,  now  when  it  is  made.  The  govern¬ 
ment  indeed  could  have  done  both ;  and  in  countries  where 
the  practice  of  co-operation  is  only  in  the  earlier  stages  of  its 
growth,  the  government  can  alone  be  looked  to  for  any  of  the 
works  for  which  a  great  combination  of  means  is  requisite; 
because  it  can  obtain  those  means  by  compulsory  taxation, 
and  is  already  accustomed  to  the  conduct  of  large  operations. 
For  reasons,  however,  which  are  tolerably  well  known,  and  of 
which  we  shall  treat  fully  hereafter,  government  agency  for  the 
conduct  of  industrial  operations  is  generally  one  of  the  least 
eligible  resources,  when  any  other  is  available. 

Next,  there  are  undertakings  which  individuals  are  not  ab¬ 
solutely  incapable  of  performing,  but  which  they  cannot  per¬ 
form  on  the  scale  and  with  the  continuity  which  are  ever  more 
and  more  required  by  the  exigencies  of  a  society  in  an  advanc- 


PRODUCTION  ON  A  LARGE  AND  SMALL  SCALE  135 


ing  state.  Individuals  are  quite  capable  of  despatching  ships 
from  England  to  any  or  every  part  of  the  world,  to  carry  pas¬ 
sengers  and  letters;  the  thing  was  done  before  joint  stock 
companies  for  the  purpose  were  heard  of.  But  when,  from  the 
increase  of  population  and  transactions,  as  well  as  of  means  of 
payment,  the  public  will  no  longer  content  themselves  with 
occasional  opportunities,  but  require  the  certainty  that  packets 
shall  start  regularly,  for  some  places  once  or  even  twice  a  day, 
for  others  once  a  week,  for  others  that  a  steamship  of  great 
size  and  expensive  construction  shall  depart  on  fixed  days  twice 
in  each  month,  it  is  evident  that  to  afford  an  assurance  of  keep¬ 
ing  up  with  punctuality  such  a  circle  of  costly  operations,  re¬ 
quires  a  much  larger  capital  and  a  much  larger  staff  of  qualified 
subordinates  than  can  be  commanded  by  an  individual  capitalist. 
There  are  other  cases,  again,  in  which  though  the  business 
might  be  perfectly  well  transacted  with  small  or  moderate  capi¬ 
tals,  the  guarantee  of  a  great  subscribed  stock  is  necessary  or 
desirable  as  a  security  to  the  public  for  the  fulfilment  of  pecun¬ 
iary  engagements.  This  is  especially  the  case  when  the  nature 
of  the  business  requires  that  numbers  of  persons  should  be 
willing  to  trust  the  concern  with  their  money :  as  in  the  busi¬ 
ness  of  banking,  and  that  of  insurance :  to  both  of  which  the 
joint  stock  principle  is  eminently  adapted.  It  is  an  instance 
of  the  folly  and  jobbery  of  the  rulers  of  mankind,  that  until 
a  late  period  the  joint  stock  principle,  as  a  general  resort,  was 
in  this  country  interdicted  by  law  to  these  two  modes  of  busi¬ 
ness  ;  to  banking  altogether,  and  to  insurance  in  the  depart¬ 
ment  of  sea  risks ;  in  order  to  bestow  a  lucrative  monopoly  on 
particular  establishments  which  the  government  was  pleased 
exceptionally  to  license,  namely  the  Bank  of  England,  and  two 
insurance  companies,  the  London  and  the  Royal  Exchange. 

Another  advantage  of  joint  stock,  or  associated  management, 
is  its  incident  of  publicity.  This  is  not  an  invariable,  but  it 
is  a  natural,  consequence  of  the  joint  stock  principle,  and  might 
be,  as  in  some  important  cases  it  already  is,  compulsory.  In 
banking,  insurance,  and  other  businesses  which  depend  wholly 
on  confidence,  publicity  is  a  still  more  important  element  of 
success  than  a  large  subscribed  capital.  A  heavy  loss  occurring 
in  a  private  bank  may  be  kept  secret ;  even  though  it  were  of 
such  magnitude  as  to  cause  the  ruin  of  the  concern,  the  banker 
may  still  carry  it  on  for  years,  trying  to  retrieve  its  position. 


1 36 


POLITICAL  ECONOMY 


only  to  fall  in  the  end  with  a  greater  crash:  but  this  cannot 
so  easily  happen  in  the  case  of  a  joint  stock  company  whose 
accounts  are  published  periodically.  The  accounts,  even  if 
cooked,  still  exercise  some  check ;  and  the  suspicions  of  share¬ 
holders.  breaking  out  at  the  general  meetings,  put  the  public  on 
their  guard. 

These  are  some  of  the  advantages  of  joint  stock  over  individ¬ 
ual  management.  But  if  we  look  to  the  other  side  of  the  ques¬ 
tion,  we  shall  find  that  individual  management  has  also  very 
great  advantages  over  joint  stock.  The  chief  of  these  is  the 
much  keener  interest  of  the  managers  in  the  success  of  the 
undertaking. 

The  administration  of  a  joint  stock  association  is,  in  the 
main,  administration  by  hired  servants.  Even  the  committee, 
or  board  of"  directors,  who  are  supposed  to  superintend  the 
management,  and  who  do  really  appoint  and  remove  the  man¬ 
agers,  have  no  pecuniary  interest  in  the  good  working  of  the 
concern  beyond  the  shares  they  individually  hold,  which  are 
always  a  very  small  part  of  the  capital  of  the  association,  and 
in  general  but  a  small  part  of  the  fortunes  of  the  directors  them¬ 
selves  ;  and  the  part  they  take  in  the  management  usually  di¬ 
vides  their  time  with  many  other  occupations,  of  as  great  or 
greater  importance  to  their  own  interest ;  the  business  being 
the  principal  concern  of  no  one  except  those  who  are  hired  to 
carry  it  on.  But  experience  shows,  and  proverbs,  the  ex¬ 
pression  of  popular  experience,  attest,  how  inferior  is  the  qual¬ 
ity  of  hired  servants,  compared  with  the  ministration  of  those 
personally  interested  in  the  work,  and  how  indispensable,  when 
hired  service  must  be  employed,  is  “  the  master’s  eye  ”  to  watch 
over  it. 

The  successful  conduct  of  an  industrial  enterprise  requires 
two  quite  distinct  qualifications :  fidelity,  and  .zeal.  The  fidelity 
of  the  hired  managers  of  a  coficenETt  is~pbssible  to  secure. 
When  their  work  admits  of  being  reduced  to  a  definite  set  of 
rules,  the  violation  of  these  is  a  matter  on  which  conscience 
cannot  easily  blind  itself,  and  on  which  responsibility  may  be 
enforced  by  the  loss  of  employment.  But  to  carry  on  a  great 
business  successfully,  requires  a  hundred  things  which,  as  they 
cannot  be  defined  beforehand,  it  is  impossible  to  convert  into 
distinct  and  positive  obligations.  First  and  principally,  it  re¬ 
quires  that  the  directing  mind  should  be  incessantly  occupied 


PRODUCTION  ON  A  LARGE  AND  SMALL  SCALE  137 


^fith  the  subject;  should  be  continually  laying  schemes  by 
which  greater  profit  may  be  obtained,  or  expense  saved.  This 
intensity  of  interest  in  the  subject  it  is  seldom  to  be  expected 
that  anyone  should  feel,  who  is  conducting  a  business  as  the 
hired  servant  and  for  the  profit  of  another.  There  are  experi¬ 
ments  in  human  affairs  which  are  conclusive  on  the  point.  Look 
at  the  whole  class  of  rulers,  and  ministers  of  state.  The  work 
they  are  intrusted  with,  is  among  the  most  interesting  and 
exciting  of  all  occupations ;  the  personal  share  which  they  them¬ 
selves  reap  of  the  national  benefits  or  misfortunes  which  befall 
the  state  under  their  rule,  is  far  from  trifling,  and  the  rewards 
and  punishments  which  they  may  expect  from  public  estima¬ 
tion  are  of  the  plain  and  palpable  kind  which  are  most  keenly 
felt  and  most  widely  appreciated.  Yet  how  rare  a  thing  is  it 
to  find  a  statesman  in  whom  mental  indolence  is  not  stronger 
than  all  these  inducements,  How  infinitesimal  is  the  proportion 
who  trouble  themselves  to  form,  or  even  to  attend  to,  plans  of 
public  improvement,  unless  when  it  is  made  still  more  trouble¬ 
some  to  them  to  remain  inactive;  or  who  have  any  other  real 
desire  than  that  of  rubbing  on,  so  as  to  escape  general  blame. 
On  a  smaller  scale,  all  who  have  ever  employed  hired  labor  have 
had  ample  experience  of  the  efforts  made  to  give  as  little  labor 
in  exchange  for  the  .wages,  as  is  compatible  with  not  being 
turned  off.  The  universal  neglect  by  domestic  servants  of 
their  employer’s  interests,  wherever  these  are  not  protected  by 
some  fixed  rule,  is  matter  of  common  remark ;  unless  where 
long  continuance  in  the  same  service,  and  reciprocal  good  of¬ 
fices,  have  produced  either  personal  attachment,  or  some  feeling 
of  a  common  interest. 

Another  of  the  disadvantages  of  joint  stock  concerns,  which 
is  in  some  degree  common  to  all  concerns  on  a  large  scale,  is 
disregard  of  small  gains  and  small  savings.  In  the  manage¬ 
ment  of  a  great  capital  and  great  transactions,  especially  when 
the  managers  have  not  much  interest  in  it  of  their  own,  small 
sums  are  apt  to  be  counted  for  next  tcf  nothing ;  they  never 
seem  worth  the  care  and  trouble  which  it  costs  to  attend  to 
them,  and  the  credit  of  liberality  and  open-handedness  is  cheaply 
bought  by  a  disregard  of  such  trifling  considerations.  But  small 
profits  and  small  expenses,  often  repeated,  amount  to  great 
gains  and  losses :  and  of  this  a  large  capitalist  is  often  a  suffi¬ 
ciently  good  calculator  to  be  practically  aware ;  and  to  arrange 


i38 


POLITICAL  ECONOMY 


his  business  on  a  system,  which  if  enforced  by  a  sufficiently 
vigilant  superintendence,  precludes  the  possibility  of  the  habit¬ 
ual  waste,  otherwise  incident  to  a  great  business.  But  the  man¬ 
agers  of  a  joint  stock  concern  seldom  devote  themselves  suffi¬ 
ciently  to  the  work,  to  enforce  unremittingly,  even  if  introduced, 
through  every  detail  of  the  business,  a  really  economical  system. 

From  considerations  of  this  nature,  Adam  Smith  was  led  to 
enunciate  as  a  principle,  that  joint  stock  companies  could  never 
be  expected  to  maintain  themselves  without  an  exclusive  privi¬ 
lege,  except  in  branches  of  business  which  like  banking,  insur¬ 
ance,  and  some  others,  admit  of  being,  in  a  considerable  degree, 
reduced  to  fixed  rules.  This  however  is  one  of  those  overstate¬ 
ments  of  a  true  principle,  often  met  with  in  Adam  Smith.  In 

his  days  there  were  few  instances  of  joint  stock  companies 

*  * 

which  had  been  permanently  successful  without  a  monopoly, 
except  the  class  of  cases  which  he  referred  to;  but  since  his 
time  there  have  been  many;  and  the  regular  increase  both  of 
the  spirit  of  combination  and  of  the  ability  to  combine,  will 
doubtless  produce  many  more.  Adam  Smith  fixed  his  observa¬ 
tion  too  exclusively  on  the  superior  energy  and  more  unremit¬ 
ting  attention  brought  to  a  business  in  which  the  whole  stake 
and  the  whole  gain  belong  to  the  persons  conducting  it;  and 
he  overlooked  various  countervailing  considerations  which  go 
a  great  way  toward  neutralizing  even  that  great  point  of  supe¬ 
riority. 

Of  these  one  of  the  most  important  is  that  which  relates  to 
the  intellectual  and  active  qualifications  of  the  directing  head. 
The  stimulus  of  individual  interest  is  some  security  for  exer¬ 
tion,  but  exertion  is  of  little  avail  if  the  intelligence  exerted 
is  of  an  inferior  order,  which  it  must  necessarily  be  in  the 
majority  of  concerns  carried  on  by  the  persons  chiefly  interested 
in  them.  Where  the  concern  is  large,  and  can  afford  a  re¬ 
muneration  sufficient  to  attract  a  class  of  candidates  superior 
to  the  common  average,  it  is  possible  to  select  for  the  general 
management,  and  for  all  the  skilled  employments  of  a  subordi¬ 
nate  kind,  persons  of  a  degree  of  acquirement  and  cultivated 
intelligence  which  more  than  compensates  for  their  inferior 
interest  in  the  result.  Their  greater  perspicacity  enables  them, 
with  even  a  part  of  their  minds,  to  see  probabilities  of  advantage 
which  never  occur  to  the  ordinary  run  of  men  by  the  continued 
exertion  of  the  whole  of  theirs ;  and  their  superior  knowledge, 


PRODUCTION  ON  A  LARGE  AND  SMALL  SCALE  139 


and  habitual  rectitude  of  perception  and  of  judgment,  guard 
them  against  blunders,  the  fear  of  which  would  prevent  the 
others  from  hazarding  their  interests  in  any  attempt  out  of  the 
ordinary  routine. 

It  must  be  further  remarked,  that  it  is  not  a  necessary  conse¬ 
quence  of  joint  stock  management,  that  the  persons  employed, 
whether  in  superior  or  in  subordinate  offices,  should  be  paid 
wholly  by  fixed  salaries.  There  are  modes  of  connecting  more 
or  less  intimately  the  interest  of  the  employes  with  the  pecun¬ 
iary  success  of  the  concern.  There  is  a  long  series  of  inter¬ 
mediate  positions,  between  working  wholly  on  one’s  own  ac¬ 
count,  and  working  by  the  day,  week,  or  year  for  an  invariable 
payment.  Even  in  the  case  of  ordinary  unskilled  labor,  there 
is  such  a  thing  as  task-work,  or  working  by  the  piece :  and  the 
superior  efficiency  of  this  is  so  well  known,  that  judicious  em¬ 
ployers  always  resort  to  it  when  the  work  admits  of  being  put 
out  in  definite  portions,  without  the  necessity  of  too  troublesome 
a  surveillance  to  guard  against  inferiority  in  the  execution. 
In  the  case  of  the  managers  of  joint  stock  companies,  and  of 
the  superintending  and  controlling  officers  in  many  private 
establishments,  it  is  a  common  enough  practice  to  connect  their 
pecuniary  interest  with  the  interest  of  their  employers,  by  giv¬ 
ing  them  part  of  their  remuneration  in  the  form  of  a  percentage 
on  the  profits.  The  personal  interest  thus  given  to  hired  ser¬ 
vants  is  not  comparable  in  intensity  to  that  of  the  owner  of 
the  capital ;  but  it  is  sufficient  to  be  a  very  material  stimulus 
to  zeal  and  carefulness,  and,  when  added  to  the  advantage  of 
superior  intelligence,  often  raises  the  quality  of  the  service  much 
above  that  which  the  generality  of  masters  are  capable  of  ren¬ 
dering  to  themselves.  The  ulterior  extensions  of  which  this 
principle  of  remuneration  is  susceptible,  being  of  great  social 
as  well  as  economical  importance,  will  be  more  particularly  ad¬ 
verted  to  in  a  subsequent  stage  of  the  present  inquiry. 

As  I  have  already  remarked  of  large  establishments  generally, 
when  compared  with  small  ones,  whenever  competition  is  free 
its  results  will  show  whether  individual  or  joint  stock  agency 
is  best  adapted  to  the  particular  case,  since  that  which  is  most 
efficient  and  most  economical  will  always  in  the  end  succeed  in 
underselling  the  other. 

§  3.  The  possibility  of  substituting  the  large  system  of  pro¬ 
duction  for  the  small,  depends,  of  course,  in  the  first  place,  on 


140 


POLITICAL  ECONOMY 


^he  extent  of  foe  market.  The  large  system  can  only  be  advan¬ 
tageous  when  a  large  amount  of  business  is  to  be  done:  it 
implies,  therefore,  either  a  populous  and  flourishing  community, 
or  a  great  opening  for  exportation.  Again,  this  as  well  as  every 
other  change  in  the  system  of  production  is  greatly  favored  by 
a  progressive  condition  of  capital.  It  is  chiefly  when  the  capital 
of  a  country  is  receiving  a  great  annual  increase,  that  there  is 
a  large  amount  of  capital  seeking  for  investment:  and  a  new 
enterprise  is  much  sooner  and  more  easily  entered  upon  by 
new  capital,  than  by  withdrawing  capital  from  existing  employ¬ 
ments.  The  change  is  also  much  facilitated  by  the  existence  of 
large  capitals  in  few  hands.  It  is  true  that  the  same  amount 
of  capital  can  be  raised  by  bringing  together  many  small  sums. 
But  this  (besides  that  it  is  not  equally  well  suited  to  all  branches 
of  industry),  supposes  a  much  greater  degree  of  commercial 
confidence  and  enterprise  diffused  through  the  community,  and 
belongs  altogether  to  a  more  advanced  stage  of  industrial 
progress. 

In  the  countries  in  which  there  are  the  largest  markets,  the 
widest  diffusion  of  commercial  confidence  and  enterprise,  the 
greatest  annual  increase  of  capital,  and  the  greatest  number  of 
large  capitals  owned  by  individuals,  there  is  a  tendency  to  sub¬ 
stitute  more  and  more,  in  one  branch  of  industry  after  another, 
large  establishments  for  small  ones.  In  England,  the  chief  type 
of  all  these  characteristics,  there  is  a  perpetual  growth  not  only 
of  large  manufacturing  establishments,  but  also,  wherever  a 
sufficient  number  of  purchasers  are  assembled,  of  shops  and 
warehouses  for  conducting  retail  business  on  a  large  scale. 
These  are  almost  always  able  to  undersell  the  smaller  trades¬ 
men,  partly,  it  is  understood,  by  means  of  division  of  labor,  and 
the  economy  occasioned  by  limiting  the  employment  of  skilled 
agency  to  cases  where  skill  is  required ;  and  partly,  no  doubt, 
by  the  saving  of  labor  arising  from  the  great  scale  of  the  trans¬ 
actions  :  as  it  costs  no  more  time,  and  not  much  more  exertion 
of  mind,  to  make  a  large  purchase,  for  example,  than  a  small 
one,  and  very  much  less  than  to  make  a  number  of  small  ones. 

With  a  view  merely  to  production,  and  to  the  greatest  effi¬ 
ciency  of  labor,  this  change  is  wholly  beneficial.  In  some  cases 
it  is  attended  with  drawbacks,  rather  social  than  economical, 
the  nature  of  which  has  been  already  hinted  at.  But  whatever 
disadvantages  may  be  supposed  to  attend  on  the  change  from 


PRODUCTION  ON  A  LARGE  AND  SMALL  SCALE  141 


a  small  to  a  large  system  of  production,  they  are  not  applicable 
to  the  change  from  a  large  to  a  still  larger.  When,  in  any 
employment,  the  regime  of  independent  small  producers  has 
either  never  been  possible,  or  has  been  superseded,  and  the  sys¬ 
tem  of  many  work-people  under  one  management  has  become 
fully  established,  from  that  time  any  further  enlargement  in  the 
scale  of  production  is  generally  an  unqualified  benefit.  It  is 
obvious,  for  example,  how  great  an  economy  of  labor  would 
be  obtained  if  London  were  supplied  by  a  single  gas  or  water 
company  instead  of  the  existing  plurality.  While  there  are  even 
as  many  as  two,  this  implies  double  establishments  of  all  sorts, 
when  one  only,  with  a  small  increase,  could  probably  perform 
the  whole  operation  equally  well ;  double  sets  of  machinery  and 
works,  when  the  whole  of  the  gas  or  water  required  could  gen¬ 
erally  be  produced  by  one  set  only ;  even  double  sets  of  pipes, 
if  the  companies  did  not  prevent  this  needless  expense  by  agree¬ 
ing  upon  a  division  of  the  territory.  Were  there  only  one  es¬ 
tablishment,  it  could  make  lower  charges,  consistently  with 
obtaining  the  rate  of  profit  now  realized.  But  would  it  do  so  ? 
Even  if  it  did  not,  the  community  in  the  aggregate  would  still 
be  a  gainer,  since  the  shareholders  are  a  part  of  the  community, 
and  they  would  obtain  higher  profits  while  the  consumers  paid 
only  the  same.  It  is,  however,  an  error  to  suppose  that  the 
prices  are  ever  permanently  kept  down  by  the  competition  of 
these  companies.  Where  competitors  are  so  few,  they  always 
end  by  agreeing  not  to  compete.  They  may  run  a  race  of  cheap¬ 
ness  to  ruin  a  new  candidate,  but  as  soon  as  he  has  established 
his  footing  they  come  to  terms  with  him.  When,  therefore,  a 
business  of  real  public  importance  can  only  be  carried  on  ad¬ 
vantageously  upon  so  large  a  scale  as  to  render  the  liberty  of 
competition  almost  illusory,  it  is  an  unthrifty  dispensation  of 
the  public  resources  that  several  costly  sets  of  arrangements 
should  be  kept  up  for  the  purpose  of  rendering  to  the  commu¬ 
nity  this  one  service.  It  is  much  better  to  treat  it  at  once  as 
a  public  function  ;  and  if  it  be  not  such  as  the  government  itself 
could  beneficially  undertake,  it  should  be  made  over  entire  to 
the  company  or  association  which  will  perform  it  on  the  best 
terms  for  the  public.  In  the  case  of  railways,  for  example,  no 
one  can  desire  to  see  the  enormous  waste  of  capital  and  land 
(not  to  speak  of  increased  nuisance)  involved  in  the  construc¬ 
tion  of  a  second  railway  to  connect  the  same  places  already 


142 


POLITICAL  ECONOMY 


united  by  an  existing  one;  while  the  two  would  not  do  the 
work  better  than  it  could  be  done  by  one,  and  after  a  short 
time  would  probably  be  amalgamated.  Only  one  such  line 
ought  to  be  permitted,  but  the  control  over  that  line  never  ought 
to  be  parted  with  by  the  State,  unless  on  a  temporary  concession, 
as  in  France;  and  the  vested  right  which  Parliament  has  al¬ 
lowed  to  be  acquired  by  the  existing  companies,  like  all  other 
proprietary  rights  which  are  opposed  to  public  utility,  is  mor¬ 
ally  valid  only  as  a  claim  to  compensation. 

§  4.  The  question  between  the  large  and  the  small  systems 
of  production  as  applied  to  agriculture — between  large  and 
small  farming,  the  grande  and  the  petite  cidture — stands,  in 
many  respects,  on  different  grounds  from  the  general  question 
between  great  and  small  industrial  establishments.  In  its  social 
aspects,  and  as  an  element  in  the  Distribution  of  Wealth,  this 
question  will  occupy  us  hereafter :  but  even  as  a  question  of 
production,  the-superiorily  of  the  large  system  in  ^agriculture 
is  by  no  means  so  clearly  established  asm  manufactures. 

I  have  already  remarked,  that  the  operations  of  agriculture 
are  little  susceptible  of  benefit  from  the  division  of  labor.  There 
is  but  little  separation  of  employments  even  on  the  largest  farms. 
The  same  persons  may  not  in  general  attend  to  the  live  stock, 
to  the  marketing,  and  to  the  cultivation  of  the  soil ;  but  much 
beyond  that  primary  and  simple  classification  the  subdivision 
is  not  carried.  The  combination  of  labor  of  which  agriculture 
is  susceptible,  is  chiefly  that  which  Mr.  Wakefield  terms  Simple 
Co-operation ;  several  persons  helping  one  another  in  the  same 
work,  at  the  same  time  and  place.  But  I  confess  it  seems  to 
me  that  this  able  writer  attributes  more  importance  to  that  kind 
of  co-operation,  in  reference  to  agriculture  properly  so  called, 
than  it  deserves.  None  of  the  common  farming  operations  re¬ 
quire  much  of  it.  There  is  no  particular  advantage  in  setting 
a  great  number  of  people  to  work  together  in  ploughing  or  dig¬ 
ging  or  sowing  the  same  field,  or  even  in  mowing  or  reaping 
it  unless  time  presses.  A  single  family  can  generally  supply 
all  the  combination  of  labor  necessary  for  these  purposes.  And 
in  the  works  in  which  a  union  of  many  efforts  is  really  needed, 
there  is  seldom  found  any  impracticability  in  obtaining  it  where 
farms  are  small. 

The  waste  of  productive  power  by  subdivision  of  the  land 
often  amounts  to  a  great  evil,  but  this  applies  chiefly  to  a  sub- 


PRODUCTION  ON  A  LARGE  AND  SMALL  SCALE  143 


division  so  minute,  that  the  cultivators  have  not  enough  land 
to  occupy  their  time.  Up  to  that  point  the  same  principles 
which  recommend  large  manufactories  are  applicable  to  agri¬ 
culture.  For  the  greatest  productive  efficiency,  it  is  generally 
desirable  (though  even  this  proposition  must  be  received  with 
qualifications)  that  no  family  who  have  any  land,  should  have 
less  than  they  could  cultivate,  or  than  will  fully  employ  their 
cattle  and  tools.  These,  however,  are  not  the  dimensions  of 
large  farms,  but  of  what  are  reckoned  in  England  very  small 
ones.  The  large  farmer  has  some  advantage  in  the  article  of 
buildings.  It  does  not  cost  so  much  to  house  a  great  number 
of  cattle  in  one  building,  as  to  lodge  them  equally  well  in  several 
buildings.  There  is  also  some  advantage  in  implements.  A 
small  farmer  is  not  so  likely  to  possess  expensive  instruments. 
But  the  principal  agricultural  implements,  even  when  of  the 
best  construction,  are  not  expensive.  It  may  not  answer  to  a 
small  farmer  to  own  a  threshing  machine,  for  the  small  quan¬ 
tity  of  corn  he  has  to  thresh ;  but  there  is  no  reason  why  such 
a  machine  should  not  in  every  neighborhood  be  owned  in  com¬ 
mon,  or  provided  by  some  person  to  whom  the  others  pay  a 
consideration  for  its  use ;  especially  as,  when  worked  by  steam, 
they  are  so  constructed  as  to  be  movable.*  The  large  farmer 
can  make  some  saving  in  cost  of  carriage.  There  is  nearly  as 
much  trouble  in  carrying  a  small  portion  of  produce  to  market, 
as  a  much  greater  produce;  in  bringing  home  a  small,  as  a 
much  larger  quantity  of  manures,  and  articles  of  daily  consump¬ 
tion.  There  is  also  the  greater  cheapness  of  buying  things  in 
large  quantities.  These  various  advantages  must  count  for 
something,  but  it  does  not  seem  that  they  ought  to  count  for 
very  much.  In  England  for  some  generations,  there  has  been 
little  experience  of  small  farms;  but  in  Ireland  the  experience 
has  been  ample,  not  merely  under  the  worst  but  under  the  best 
management:  and  the  highest  Irish  authorities  may  be  cited 
in  opposition  to  the  opinion  which  on  this  subject  commonly 
prevails  in.  England.  Mr.  Blacker,  for  example,  one  of  the 
most  experienced  agriculturists  and  successful  improvers  in 
the  North  of  Ireland,  whose  experience  was  chiefly  in  the  best 


*  The  observations  in  the  text  may 
hereafter  require  some  degree  of  modi¬ 
fication  from  inventions  such  as  the 
steam  plough  and  the  reaping  machine. 
The  effect,  however,  of  these  improve¬ 
ments  on  the  relative  advantages  of  large 


and  small  farms,  will  not  depend  on  the 
efficiency  of  the  instruments,  but  on 
their  costliness.  I  see  no  reason  to  ex¬ 
pect  that  this  will  be  such  as  to  make 
them  inaccessible  to  small  farmers,  or 
combinations  of  small  farmers. 


144 


POLITICAL  ECONOMY 


cultivated,  which  are  also  the  most  minutely  divided,  parts  of 
the  country,  was  of  opinion,  that  tenants  holding  farms  not 
exceeding  from  five  to  eight  or  ten  acres,  could  live  comfort¬ 
ably,  and  pay  as  high  a  rent  as  any  large  farmer  whatever. 
“  I  am  firmly  persuaded  ”  (he  says,*)  “  that  the  small  farmer 
who  holds  his  own  plough  and  digs  his  own  ground,  if  he  fol¬ 
lows  a  proper  rotation  of  crops,  and  feeds  his  cattle  in  the  house, 
can  undersell  the  large  farmer,  or  in  other  words  can  pay  a 
rent  which  the  other  cannot  afford ;  and  in  this  I  am  confirmed 
by  the  opinion  of  many  practical  men  who  have  well  considered 
the  subject.  .  .  .  The  English  farmer  of  700  to  800  acres 
is  a  kind  of  man  approaching  to  what  is  known  by  the  name  of 
a  gentleman  farmer.  He  must  have  his  horse  to  ride,  and  his 
gig,  and  perhaps  an  overseer  to  attend  to  his  laborers ;  he  cer¬ 
tainly  cannot  superintend  himself  the  labor  going  on  in  a  farm 
of  800  acres.”  After  a  few  other  remarks,  he  adds :  “  Besides 
all  these  drawbacks,  which  the  small  farmer  knows  little  about, 
there  is  the  great  expense  of  carting  out  the  manure  from  the 
homestead  to  such  a  great  distance,  and  again  carting  home 
the  crop.  A  single  horse  will  consume  the  produce  of  more 
land  than  would  feed  a  small  farmer  and  his  wife  and  two  chil¬ 
dren.  And  what  is  more  than  all,  the  large  farmer  says  to  his 
laborers,  go  to  your  work;  but  when  the  small  farmer  has 
occasion  to  hire  them,  he  says,  come;  the  intelligent  reader  will, 
I  dare  say,  understand  the  difference.” 

One  of  the  objections  most  urged  against  small  farms  is,  that 
they  do  not  and  cannot  maintain,  proportionally  to  their  extent, 
so  great  a  number  of  cattle  as  large  farms,  and  that  this  occa¬ 
sions  such  a  deficiency  of  manure,  that  a  soil  much  subdivided 
must  always  be  impoverished.  It  will  be  found,  however,  that 
subdivision  only  produces  this  effect  when  it  throws  the  land 
into  the  hands  of  cultivators  so  poor  as  not  to  possess  the  amount 
of  live  stock  suitable  to  the  size  of  their  farms.  A  small  farm 
and  a  badly  stocked  farm  are  not  synonymous.  To  make  the 
comparison  fairly,  we  must  suppose  the  same  amount  of  capital 
which  is  possessed  by  the  large  farmers  to  be  disseminated 
among  the  small  ones.  When  this  condition,  or  even  any  ap¬ 
proach  to  it,  exists,  and  when  stall  feeding  is  practised  (and 
stall  feeding  now  begins  to  be  considered  good  economy  even 

*  “  Prize  Essay  on  the  Management  of  Landed  Property  in  Ireland,”  by  Will¬ 
iam  Blacker,  Esq.  (1837),  p.  23. 


PRODUCTION  ON  A  LARGE  AND  SMALL  SCALE  145 


on  large  farms),  experience,  far  from  bearing  out  the  assertion 
that  small  farming  is  unfavorable  to  the  multiplication  of  cattle, 
conclusively  establishes  the  very  reverse.  The  abundance  of 
cattle,  and  copious  use  of  manure,  on  the  small  farms  of  Flan¬ 
ders,  are  the  most  striking  features  in  that  Flemish  agriculture 
which  is  the  admiration  of  all  competent  judges,  whether  in 
England  or  on  the  Continent.* 


*  “  The  number  of  beasts  fed  on  a 
farm  of  which  the  whole  is  arable  land,” 
(says  the  elaborate  and  intelligent  treat¬ 
ise  on  Flemish  Husbandry,  from  per¬ 
sonal  observation  and  the  best  sources, 
published  in  the  Library  of  the  Society 
for  the  Diffusion  of  Useful  Knowledge) 
“  is  surprising  to  those  who  are  not  ac¬ 
quainted  with  the  mode  in  which  the 
food  is  prepared  for  the  cattle.  A  beast 
for  every  three  acres  of  land  is  a  com¬ 
mon  proportion,  and  in  very  small  oc¬ 
cupations  where  much  spade  husbandry 
is  used,  the  proportion  is  still  greater. 
After  comparing  the  accounts  given  in 
a  variety  of  places  and  situations  of  the 
average  quantity  of  milk  which  a  cow 
gives  when  fed  in  the  stall,  the  result 
is,  that  it  greatly  exceeds  that  of  our 
best  dairy  farms,  and  the  quantity  of 
butter  made  from  a  given  quantity  of 
milk  is  also  greater.  It  appears  aston¬ 
ishing  that  the  occupier  of  only  ten  or 
twelve  acres  of  light  arable  land  should 
be  able  to  maintain  four  or  five  cows, 
but  the  fact  is  notorious  in  the  Waes 
country.”  (Pp.  59,  60.) 

This  subject  is  treated  very  intelli- 
ently  in  the  work  of  M.  Passy,  “  On 
ystems  of  Cultivation  and  their  Influ¬ 
ence  on  Social  Economy,”  one  of  the 
most  impartial  discussions,  as  between 
the  two  systems,  which  has  yet  appeared 
in  France. 

“  Without  doubt  it  is  England  that, 
on  an  equal  surface,  feeds  the  greatest 
number  of  animals;  Holland  and  some 
arts  of  Lombardy  can  alone  vie  with 
er  in  this  respect:  but  is  this  a  conse¬ 
quence  of  the  mode  of  cultivation,  and 
have  not  climate  and  local  situation  a 
share  in  producing  it?  Of  this  I  think 
there  can  be  no  doubt.  In  fact,  what¬ 
ever  may  have  been  said,  wherever  large 
and  small  cultivation  meet  in  the  same 
place,  the  latter,  though  it  cannot  sup¬ 
port  as  many  sheep,  possesses,  all  things 
considered,  the  greatest  quantity  of  ma¬ 
nure-producing  animals. 

“  In  Belgium,  for  example,  the  two 
provinces  of  smallest  farms  are  Antwerp 
and  East  Flanders,  and  they  possess  on 
an  average  for  every  100  hectares  (250 
acres)  of  cultivated  land,  74  horned  cat¬ 
tle  and  14  sheep.  The  two  provinces 
where  we  find  the  large  farms  are  Na¬ 
mur  and  Hainaut,  and  they  average,  for 
every  100  hectares  of  cultivated  ground, 
only  30  horned  cattle  and  45  sheep. 
Reckoning,  as  is  the  custom,  ten  sheep 
as  equal  to  one  head  of  horned  cattle, 
we  find  in  the  first  case,  the  equivalent 
of  76  beasts  to  maintain  the  fecundity 
of  the  soil;  in  the  latter  case  less  than 

VOL.  I. — 10 


35,  a  difference  which  must  be  called 
enormous.  (See  the  statistical  docu¬ 
ments  published  by  the  Minister  of  the 
Interior.)  The  abundance  of  animals, 
in  the  parts  of  Belgium  which  are  most 
subdivided,  is  nearly  as  great  as  in 
England.  Calculating  the  number  in 
England  in  proportion  only  to  the  culti¬ 
vated  ground,  there  are  for  each  100 
hectares,  65  horned  cattle  and  nearly  260 
sheep,  together  equal  to  91  of  the  former, 
being  only  an  excess  of  15.  It  should 
besides  be  remembered,  that  in  Belgium 
stall  feeding  being  continued  nearly  the 
whole  year,  hardly  any  of  the  manure  is 
lost,  while  in  England,  grazing  in  the 
open  fields  diminishes  considerably  the 
quantity  which  can  be  completely  util¬ 
ized. 

“  Again,  in  the  Department  of  the 
Nord,  the  arrondissements  which  have 
the  smallest  farms  support  the  greatest 
quantity  of  animals.  While  the  arron¬ 
dissements  of  Lille  and  Hazebrouck, 
besides  a  greater  number  of  horses, 
maintain  the  equivalent  of  52  and  46 
head  of  horned  cattle,  those  of  Dunkirk 
and  Avesnes,  where  the  farms  are  larger, 
produce  the  equivalent  of  only  44  and  40 
head.  (See  the  statistics  of  France  pub¬ 
lished  by  the  Minister  of  Commerce.) 

“  A  similar  examination  extended  to 
other  portions  of  France  would  yield 
similar  results.  In  the  immediate  neigh¬ 
borhood  of  towns,  no  doubt,  the  small 
farmers,  having  no  difficulty  in  purchas¬ 
ing  manure,  do  not  maintain  animals: 
but,  as  a  general  rule,  the  kind  of  culti¬ 
vation  which  takes  most  out  of  the 
ground  must  be  that  which  is  obliged 
to  be  most  active  in  renewing  its  fer¬ 
tility.  Assuredly  the  small  farms  can¬ 
not  have  numerous  flocks  of  sheep,  and 
this  is  an  inconvenience;  but  they  sup¬ 
port  more  horned  cattle  than  the  large 
farms.  To  do  so  is  a  necessity  they 
cannot  escape  from,  in  any  country 
where  the  demands  of  consumers  re¬ 
quire  their  existence:  if  they  could  not 
fulfil  this  condition,  they  must  perish. 

“  The  following  are  particulars,  the 
exactness  of  which  is  fully  attested  by 
the  excellence  of  the  work  from  whicn 
1  extract  them,  the  statistics  of  the 
commune  of  Vensat  (department  of  Puy 
de  Dome),  lately  published  by  Dr. 
Jusseraud,  mayor  of  the  commune. 
They  are  the  more  valuable,  as  they 
throw  full  light  on  the  nature  of  the 
changes  which  the  extension  of  small 
farming  has,  in  that  district,  produced 
in  the  number  and  kind  of  animals  by 
whose  manure  the  productiveness  of 
the  soil  is  kept  up  and  increased.  The 


146 


POLITICAL  ECONOMY 


The  disadvantage,  when  disadvantage  there  is,  of  small,  or 
rather  of  peasant  farming,  as  compared  with  capitalist  farming, 
must  chiefly  consist  in  inferiority  of  skill  and  knowledge ;  but 
it  is  not  true,  as  a  general  fact,  that  such  inferiority  exists. 
Countries  of  small  farms  and  peasant  farming,  Flanders  and 
Italy,  had  a  good  agriculture  many  generations  before  England, 
and  theirs  is  still,  as  a  whole,  probably  the  best  agriculture  in 
the  world.  The  empirical  skill,  which  is  the  effect  of  daily  and 
close  observation,  peasant  farmers  often  possess  in  an  eminent 
degree.  The  traditional  knowledge,  for  example,  of  the  culture 
of  the  vine,  possessed  by  the  peasantry  of  the  countries  where 
the  best  wines  are  produced,  is  extraordinary.  There  is  no 
doubt  an  absence  of  science,  or  at  least  of  theory ;  and  to  some 
extent  a  deficiency  of  the  spirit  of  improvement,  so  far  as  relates 
to  the  introduction  of  new  processes.  There  is  also  a  want  of 
means  to  make  experiments,  which  can  seldom  be  made  with 
advantage  except  by  rich  proprietors  or  capitalists.  As  for 
those  systematic  improvements  which  operate  on  a  large  tract 
of  country  at  once  (such  as  great  works  of  draining  or  irriga¬ 
tion)  or  which  for  any  other  reason  do  really  require  large 
numbers  of  workmen  combining  their  labor,  these  are  not  in 
general  to  be  expected  from  small  farmers,  or  even  small  pro¬ 
prietors  ;  though  combination  among  them  for  such  purposes 
is  by  no  means  unexampled,  and  will  become  more  common  as 
their  intelligence  is  more  developed. 

Against  these  disadvantages  is  to  be  placed,  where  the  tenure 
of  land  is  of  the  requisite  kind,  an  ardor  of  industry  absolutely 
unexampled  in  any  other  condition  of  agriculture.  This  is  a 
subject  on  which  the  testimony  of  competent  witnesses  is  unani- 


commune  consists  of  1612  hectares,  di¬ 
vided  into  4600  parcelles,  owned  by  591 
proprietors,  and  of  this  extent  1466  hec¬ 
tares  are  under  cultivation.  In  1790, 
seventeen  farms  occupied  two-thirds  of 
the  whole,  and  twenty  others  the  re¬ 
mainder.  Since  then  the  land  has  been 
much  divided,  and  the  subdivision  is 
now  extreme.  What  has  been  the  effect 
on  the  quantity  of  cattle?  A  consider¬ 
able  increase.  In  1790  there  were  only 
about  300  horned  cattle,  and  from  1800 
to  2000  sheep;  there  are  now  676  of  the 
former  and  only  533  of  the  latter.  Thus 
1300  sheep  have  been  replaced  by  376 
oxen  and  cows,  and  (all  things  taken 
into  account)  the  quantity  of  manure 
has  increased  in  the  ratio  of  490  to  729, 
or  more  than  48  per  cent.,  not  to  men¬ 
tion  that  the  animals  being  now  stronger 
and  better  fed,  yield  a  much  greater 


contribution  than  formerly  to  the  fertili¬ 
zation  of  the  ground. 

“  Such  is  the  testimony  of  facts  on 
the  point.  It  is  not  true,  then,  that 
small  farming  feeds  fewer  animals  than 
large;  on  the  contrary,  local  circum¬ 
stances  being  the  same,  it  feeds  a 
greater  number:  and  this  is  only  what 
might  have  been  presumed;  for,  requir¬ 
ing  more  from  the  soil,  it  is  obliged  to 
take  greater  pains  for  keeping  up  its 
productiveness.  All  the  other  reproaches 
cast  upon  small  farming,  when  collated 
one  by  one  with  facts  justly  appreciated, 
will  be  seen  to  be  no  better  founded,  and 
to  have  been  made  only  because  the 
countries  compared  with  one  another 
were  differently  situated  in  respect  to 
the  general  causes  of  agricultural  pros¬ 
perity.”  (Pp.  116 — 120.) 


PRODUCTION  ON  A  LARGE  AND  SMALL  SCALE  147 


mous.  The  working  of  the  petite  culture  cannot  be  fairly  judged 
where  the  small  cultivator  is  merely  a  tenant,  and  not  even  a 
tenant  on  fixed  conditions,  but  (as  until  lately  in  Ireland)  at 
a  nominal  rent  greater  than  can  be  paid,  and  therefore  practi¬ 
cally  at  a  varying  rent  always  amounting  to  the  utmost  that  can 
be  paid.  To  understand  the  subject,  it  must  be  studied  where 
the  cultivator  is  the  proprietor,  or  at  least  a  metayer  with  a 
permanent  tenure ;  where  the  labor  he  exerts  to  increase  the 
produce  and  value  of  the  land  avails  wholly,  or  at  least  partly, 
to  his  own  benefit  and  that  of  his  descendants.  In  another  di¬ 
vision  of  our  subject,  we  shall  discuss  at  some  length  the  im¬ 
portant  subject  of  tenures  of  land,  and  I  defer  till  then  any 
citation  of  evidence  on  the  marvellous  industry  of  peasant  pro¬ 
prietors.  It  may  suffice  here  to  appeal  to  the  immense  amount 
of  gross  produce  which,  even  without  a  permanent  tenure,  Eng¬ 
lish  laborers  generally  obtain  from  their  little  allotments ;  a 
produce  beyond  comparison  greater  than  a  large  farmer  ex¬ 
tracts,  or  would  find  it  his  interest  to  extract,  from  the  same 
piece  of  land. 

And  this  I  take  to  be  the  true  reason  why  large  cultivation 
is  generally  most  advantageous  as  a  mere  investment  for  profit. 
Land  occupied  by  a  large  farmer  is  not,  in  one  sense  of  the 
word,  farmed  so  highly.  There  is  not  nearly  so  much  labor 
expended  on  it.  This  is  not  on  account  of  any  economy  arising 
from  combination  of  labor,  but  because,  by  employing  less, 
a  greater  return  is  obtained  in  proportion  to  the  outlay.  It  does 
not  answer  to  anyone  to  pay  others  for  exerting  all  the  labor 
which  the  peasant,  or  even  the  allotment  holder,  gladly  under¬ 
goes  when  the  fruits  are  to  be  wholly  reaped  by  himself.  This 
labor,  however,  is  not  unproductive ;  it  all  adds  to  the  gross 
produce.  With  anything  like  equality  of  skill  and  knowledge, 
the  large  farmer  does  not  obtain  nearly  so  much  from  the  soil 
as  the  small  proprietor,  or  the  small  farmer  with  adequate  mo¬ 
tives  to  exertion :  but  though  his  returns  are  less,  the  labor  is 
less  in  a  still  greater  degree,  and  as  whatever  labor  he  employs 
must  be  paid  for,  it  does  not  suit  his  purpose  to  employ  more. 

But  although  the  gross  produce  of  the  land  is  greatest,  other 
things  being  the  same,  under  small  cultivation,  and  although, 
therefore,  a  country  is  able  on  that  system  to  support  a  larger 
aggregate  population,  it  is  generally  assumed  by  English  writers 
that  what  is  termed  the  net  produce,  that  is,  the  surplus  after 


148 


POLITICAL  ECONOMY 


feeding  the  cultivators,  must  be  smaller;  that  therefore,  the 
population  disposable  for  all  other  purposes,  for  manufactures, 
for  commerce  and  navigation,  for  national  defence,  for  the  pro¬ 
motion  of  knowledge,  for  the  liberal  professions,  for  the 
various  functions  of  government,  for  the  arts  and  litera¬ 
ture,  all  of  which  are  dependent  on  this  surplus  for  their 
existence  as  occupations,  must  be  less  numerous;  and  that 
the  nation,  therefore  (waiving  all  question  as  to  the  con¬ 
dition  of  the  actual  cultivators),  must  be  inferior  in  the  princi¬ 
pal  elements  of  national  power,  and  in  many  of  those  of  general 
well-being.  This,  however,  has  been  taken  for  granted  much 
too  readily.  Undoubtedly,  the  non-agricultural  population  will 
bear  a  less  ratio  to  the  agricultural,  under  small  than  under 
large  cultivation.  But  that  it  will  be  less  numerous  absolutely, 
is  by  no  means  a  consequence.  If  the  total  population,  agri¬ 
cultural  and  non-agricultural,  is  greater,  the  non-agricultural 
portion  may  be  more  numerous  in  itself,  and  may  yet  be  a 
smaller  proportion  of  the  whole.  If  the  gross  produce  is  larger, 
the  net  produce  may  be  larger,  and  yet  bear  a  smaller  ratio  to 
the  gross  produce.  Yet  even  Mr.  Wakefield  sometimes  appears 
to  confound  these  distinct  ideas.  In  France  it  is  computed  that 
two-thirds  of  the  whole  population  are  agricultural.  In  Eng¬ 
land,  at  most,  one-third.  Hence  Mr.  Wakefield  infers,  that  “  as 
in  France  only  three  people  are  supported  by  the  labor  of  two 
cultivators,  while  in  England  the  labor  of  two  cultivators  sup¬ 
ports  six  people,  English  agriculture  is  twice  as  productive  as 
French  agriculture,”  owing  to  the  superior  efficiency  of  large 
farming  through  combination  of  labor.  But  in  the  first  place 
the  facts  themselves  are  overstated.  The  labor  of  two  persons 
in  England  does  not  quite  support  six  people,  for  there  is  not  a 
little  food  imported  from  foreign  countries,  and  from  Ireland. 
In  France,  too,  the  labor  of  two  cultivators  does  much  more 
than  supply  the  food  of  three  persons.  It  provides  the  three 
persons,  and  occasionally  foreigners,  with  flax,  hemp,  and  to 
a  certain  extent  with  silk,  oils,  tobacco,  and  latterly  sugar, 
which  in  England  are  wholly  obtained  from  abroad ;  nearly 
all  the  timber  used  in  France  is  of  home  growth,  nearly  all 
which  is  used  in  England  is  imported ;  the  principal  fuel  of 
France  is  procured  and  brought  to  market  by  persons  reckoned 
among  agriculturists,  in  England  by  persons  not  so  reckoned. 
I  do  not  take  into  calculation  hides  and  wool,  these  products 


PRODUCTION  ON  A  LARGE  AND  SMALL  SCALE  149 


being  common  to  both  countries,  nor  wine  or  brandy  produced 
for  home  consumption,  since  England  has  a  corresponding  pro¬ 
duction  of  beer  and  spirits ;  but  England  has  no  material  export 
of  either  article,  and  a  great  importation  of  the  last,  while  France 
supplies  wines  and  spirits  to  the  whole  world.  I  say  nothing 
of  fruit,  eggs,  and  such  minor  articles  of  agricultural  produce, 
in  which  the  export  trade  of  France  is  enormous.  But,  not  to 
lay  undue  stress  on  these  abatements,  we  will  take  the  statement 
as  it  stands.  Suppose  that  two  persons,  in  England,  do  bond 
fide  produce  the  food  of  six,  while  in  France,  for  the  same 
purpose,  the  labor  of  four  is  requisite.  Does  it  follow  that 
England  must  have  a  larger  surplus  for  the  support  of  a  non- 
agricultural  population?  No;  but  merely  that  she  can  devote 
two-thirds  of  her  whole  produce  to  the  purpose,  instead  of  one- 
third.  Suppose  the  produce  to  be  twice  as  great,  and  the  one- 
third  will  amount  to  as  much  as  the  two-thirds.  The  fact 
might  be,  that  owing  to  the  greater  quantity  of  labor  employed 
on  the  French  system,  the  same  land  would  produce  food  for 
twelve  persons  which  on  the  English  system  would  only  produce 
it  for  six :  and  if  this  were  so,  which  would  be  quite  consistent 
with  the  conditions  of  the  hypothesis,  then  although  the  food 
for  twelve  was  produced  by  the  labor  of  eight,  while  the  six 
were  fed  by  the  labor  of  only  two,  there  would  be  the  same 
number  of  hands  disposable  for  other  employment  in  the  one 
country  as  in  the  other.  I  am  not  contending  that  the  fact  is 
so.  I  know  that  the  gross  produce  per  acre  in  France  as  a 
whole  (though  not  in  its  most  improved  districts)  averages 
much  less  than  in  England,  and  that,  in  proportion  to  the  ex¬ 
tent  and  fertility  of  the  two  countries,  England  has,  in  the  sense 
we  are  now  speaking  of,  much  the  largest  disposable  popula¬ 
tion.  But  the  disproportion  certainly  is  not  to  be  measured 
by  Mr.  Wakefield’s  simple  criterion.  As  well  might  it  be  said 
that  agricultural  labor  in  the  United  States,  where,  by  a  late 
census,  four  families  in  every  five  appeared  to  be  engaged  in 
agriculture,  must  be  still  more  inefficient  than  in  France. 

The  inferiority  of  French  cultivation  (which,  taking  the 
country  as  a  whole,  must  be  allowed  to  be  real,  though  much 
exaggerated ) ,  is  probably  more  owing  to  the  lower  general 
average  of  industrial  skill  and  energy  in  that  country,  than  to 
any  special  cause :  and  even  if  partly  the  effect  of  minute  sub¬ 
division,  it  does  not  prove  that  small  farming  is  disadvanta- 


POLITICAL  ECONOMY 


150 


geous,  but  only  (what  is  undoubtedly  the  fact)  that  farms  in 
France  are  very  frequently  too  small,  and,  what  is  worse,  broken 
up  into  an  almost  incredible  number  of  patches  or  parcelles, 
most  inconveniently  dispersed  and  parted  from  one  another. 

As  a  question,  not  of  gross,  but  of  net  produce,  the  compara¬ 
tive  merits  of  the  grande  and  the  petite  culture,  especially  when 
the  small  farmer  is  also  the  proprietor,  cannot  be  looked  upon 
as  decided.  It  is  a  question  on  which  good  judges  at  present 
differ.  The  current  of  English  opinion  is  in  favor  of  large 
farms :  on  the  Continent,  the  weight  of  authority  seems  to  be 
on  the  other  side.  Professor  Rau,  of  Heidelberg,  the  author  of 
one  of  the  most  comprehensive  and  elaborate  of  extant  treatises 
on  political  economy,  and  who  has  that  large  acquaintance  with 
facts  and  authorities  on  his  own  subject,  which  generally  char¬ 
acterizes  his  countrymen,  lays  it  down  as  a  settled  truth,  that 
small  or  moderate-sized  farms  yield  not  only  a  larger  gross  but 
a  larger  net  produce:  though,  he  adds,  it  is  desirable  there 
should  be  some  great  proprietors,  to  lead  the  way  in  new  im¬ 
provements.*  The  most  apparently  impartial  and  discriminat¬ 
ing  judgment  that  I  have  met  with  is  that  of  M.  Passy,  who 
(always  speaking  with  reference  to  net  produce)  gives  his 
verdict  in  favor  of  large  farms  for  grain  and  forage :  but,  for 
the  kinds  of  culture  which  require  much  labor  and  attention, 
places  the  advantage  wholly  on  the  side  of  small  cultivation; 
including  in  this  description,  not  only  the  vine  and  the  olive, 
where  a  considerable  amount  of  care  and  labor  must  be  bestowed 
on  each  individual  plant,  but  also  roots,  leguminous  plants,  and 
those  which  furnish  the  materials  of  manufactures.  The  small 
size,  and  consequent  multiplication,  of  farms,  according  to  all 
authorities,  are  extremely  favorable  to  the  abundance  of  many 
minor  products  of  agriculture,  f 

It  is  evident  that  every  laborer  who  extracts  from  the  land 
more  than  his  own  food,  and  that  of  any  family  he  may  have, 
increases  the  means  of  supporting  a  non-agricultural  popula¬ 
tion.  Even  if  his  surplus  is  no  more  than  enough  to  buy 
clothes,  the  laborers  who  make  the  clothes  are  a  non-agricul¬ 
tural  population,  enabled  to  exist  by  food  which  he  produces. 


*  See  pp.  352  and  353  of  a  French 
translation  published  at  Brussels  in  1839, 
by  M.  Fred,  de  Kemmeter,  of  Ghent. 

t  “  In  the  department  of  the  Nord,” 
says  M.  Passy,  “  a  farm  of  20  hectares 
(50  acres)  produces  in  calves,  dairy 


produce,  poultry,  and  eggs,  a  value  of 
sometimes  1000  francs  (£40)  a  year: 
which,  deducting  expenses,  is  an  ad¬ 
dition  to  the  net  produce  of  15  to  20 
francs  per  hectare.  ’ — “  On  Systems  of 
Cultivation,”  p.  114. 


PRODUCTION  ON  A  LARGE  AND  SMALL  SCALE 


I5i 

Every  agricultural  family,  therefore,  which  produces  its  own 
necessaries,  adds  to  the  net  produce  of  agriculture  ;  and  so  does 
every  person  born  on  the  land,  who  by  employing  himself  on  it, 
adds  more  to  its  gross  produce  than  the  mere  food  which  he 
eats.  It  is  questionable  whether,  even  in  the  most  subdivided 
districts  of  Europe  which  are  cultivated  by  the  proprietors,  the 
multiplication  of  hands  on  the  soil  has  approached,  or  tends  to 
approach,  within  a  great  distance  of  this  limit.  In  France, 
though  the  subdivision  is  confessedly  too  great,  there  is  proof 
positive  that  it  is  far  from  having  reached  the  point  at  which 
it  would  begin  to  diminish  the  power  of  supporting  a  non- 
agricultural  population.  This  is  demonstrated  by  the  great  in¬ 
crease  of  the  towns ;  which  have  of  late  increased  in  a  much 
greater  ratio  than  the  population  generally,*  showing  (unless 
the  condition  of  the  town  laborers  is  becoming  rapidly  deterio¬ 
rated,  which  there  is  no  reason  to  believe)  that  even  by  the  un¬ 
fair  and  inapplicable  test  of  proportions,  the  productiveness  of 
agriculture  must  be  on  the  increase.  This,  too,  concurrently 
with  the  amplest  evidence  that  in  the  more  improved  districts 
of  France,  and  in  some  which,  until  lately,  were  among  the  un¬ 
improved,  there  is  a  considerably  increased  consumption  of 
country  produce  by  the  country  population  itself. 

Impressed  with  the  conviction  that,  of  all  faults  which  can 
be  committed  by  a  scientific  writer  on  political  and  social  sub¬ 
jects,  exaggeration,  and  assertions  beyond  the  evidence,  most 
require  to  be  guarded  against,  I  limited  myself  in  the  early  edi¬ 
tions  of  this  work  to  the  foregoing  very  moderate  statements. 
I  little  knew  how  much  stronger  my  language  might  have  been 
without  exceeding  the  truth,  and  how  much  the  actual  progress 
of  French  agriculture  surpassed  anything  which  I  had  at  that 
time  sufficient  grounds  to  affirm.  The  investigations  of  that 
eminent  authority  on  agricultural  statistics,  M.  Leonce  de 
Lavergne,  undertaken  by  desire  of  the  Academy  of  Moral  and 
Political  Sciences  of  the  Institute  of  France,  have  led  to  the 
conclusion  that  since  the  Revolution  of  1789,  the  total  produce 
of  French  agriculture  has  doubled ;  profits  and  wages  having 
both  increased  in  about  the  same,  and  rent  in  a  still  greater 
ratio.  M.  de  Lavergne,  whose  impartiality  is  one  of  his  great- 


*  During  the  interval  between  the  cen-  ceeded  the  aggregate  increase  of  all 

sus  of  1851  and  that  of  1856,  the  increase  France:  while  nearly  all  the  other  large 

of  the  population  of  Paris  alone,  ex-  towns  likewise  showed  an  increase. 


POLITICAL  ECONOMY 


*5* 

est  merits,  is,  moreover,  so  far  in  this  instance  from  the  sus¬ 
picion  of  having  a  case  to  make  out,  that  he  is  laboring  to  show, 
not  how  much  French  agriculture  has  accomplished,  but  how 
much  still  remains  for  it  to  do.  “  We  have  required  ”  (he  says) 
“  no  less  than  seventy  years  to  bring  into  cultivation  two  mill¬ 
ion  hectares  ”  (five  million  English  acres)  “  of  waste  land,  to 
suppress  half  our  fallows,  double  our  agricultural  products,  in¬ 
crease  our  population  by  30  per  cent.,  our  wages  by  100  per 
cent.,  our  rent  by  150  per  cent.  At  this  rate  we  shall  require 
three-quarters  of  a  century  more  to  arrive  at  the  point  which 
England  has  already  attained.”  * 

After  this  evidence,  we  have  surely  now  heard  the  last  of 
the  incompatibility  of  small  properties  and  small  farms  with 
agricultural  improvement.  The  only  question  which  remains 
open  is  one  of  degree :  the  comparative  rapidity  of  agricultural 
improvement  under  the  two  systems ;  and  it  is  the  general 
opinion  of  those  who  are  equally  well  acquainted  with  both, 
that  improvement  is  greatest  under  a  due  admixture  between 
them. 

In  the  present  chapter,  I  do  not  enter  on  the  question  be¬ 
tween  great  and  small  cultivation  in  any  other  respect  than  as 
a  question  of  production,  and  of  the  efficiency  of  labor.  We 
shall  return  to  it  hereafter  as  affecting  the  distribution  of  the 
produce,  and  the  physical  and  social  well-being  of  the  culti¬ 
vators  themselves ;  in  which  aspects  it  deserves,  and  requires, 
a  still  more  particular  examination. 


Chapter  X. — Of  the  Law  of  the  Increase  of  Labor 

§1.  We  have  now  successively  considered  each  of  the  agents 
or  conditions  of  production,  and  of  the  means  by  which  the 
efficacy  of  these  various  agents  is  promoted.  In  order  to  come 
to  an  end  of  the  questions  which  relate  exclusively  to  produc¬ 
tion,  one  more,  of  primary  importance,  remains. 

Production  is  not  a  fixed,  but  an  increasing  thing.  When 
not  kept  back  by  bad  institutions,  or  a  low  state  of  the  arts  of 
life,  the  produce  of  industry  has  usually  tended  to  increase ; 
stimulated  not  only  by  the  desire  of  the  producers  to  augment 

*  “Economic  Rurale  de  la  France  Societe  Centrale  d’Agriculture  de 
depuis  1789.”  Par  M.  Leonce  de  La-  France.  2me  ed.  p.  59. 
vergne,  Membre  de  l’lnstitut  et  de  la 


LAW  OF  THE  INCREASE  OF  LABOR 


153 


their  means  of  consumption,  but  by  the  increasing  number  of 
the  consumers.  Nothing  in  political  economy  can  be  of  morS 
importance  than  to  ascertain  the  law  of  this  increase  of  produc¬ 
tion  ;  the  conditions  to  which  it  is  subject ;  whether  it  has  prac¬ 
tically  any  limits,  and  what  these  are.  There  is  also  no  subject 
in  political  economy  which  is  popularly  less  understood,  or  on 
which  the  errors  committed  are  of  a  character  to  produce,  and 
do  produce,  greater  mischief. 

We  have  seen  that  the  essential  requisites  of  production  are 
three — labor,  capital,  and  natural  agents ;  the  term  capital  in¬ 
cluding  all  external  and  physical  requisites  which  are  products 
of  labor,  the  term  natural  agents  all  those  which  are  not.  But 
among  natural  agents  we  need  not  take  into  account  those 
which,  existing  in  unlimited  quantity,  being  incapable  of  ap¬ 
propriation,  and  never  altering  in  their  qualities,  are  always 
ready  to  lend  an  equal  degree  of  assistance  to  production,  what¬ 
ever  may  be  its  extent ;  as  air,  and  the  light  of  the  sun.  Being 
now  about  to  consider  the  impediments  to  production,  not  the 
facilities  for  it,  we  need  advert  to  no  other  natural  agents  than 
those  which  are  liable  to  be  deficient,  either  in  quantity  or  in 
productive  power.  These  may  be  all  represented  by  the  term 
land.  Land,  in  the  narrowest  acceptation,  as  the  source  of  ag¬ 
ricultural  produce,  is  the  chief  of  them ;  and  if  we  extend  the 
term  to  mines  and  fisheries — to  what  is  found  in  the  earth 
itself,  or  in  the  waters  which  partly  cover  it,  as  well  as  to  what 
is  grown  or  fed  on  its  surface,  it  embraces  everything  with 
which  we  need  at  present  concern  ourselves. 

We  may  say,  then,  without  a  greater  stretch  of  language  than 
under  the  necessary  explanations  is  permissible,  that  the  requi¬ 
sites  of  production  are  Labor,  Capital,  and  Land.  The  in¬ 
crease  of  production,  therefore,  depends  on  the  properties  of 
these  elements.  It  is  a  result  of  the  increase  either  of  the  ele¬ 
ments  themselves,  or  of  their  productiveness.  The  law  of  the 
increase  of  production  must  be  a  consequence  of  the  laws  of 
these  elements ;  the  limits  to  the  increase  of  production  must 
be  the  limits,  whatever  they  are,  set  by  those  laws.  We  pro¬ 
ceed  to  consider  the  three  elements  successively,  with  refer¬ 
ence  to  this  effect ;  or  in  other  words,  the  law  of  the  increase 
of  production,  viewed  in  respect  of  its  dependence,  first  on  La¬ 
bor,  secondly  on  Capital,  and  lastly  on  Land. 

§  2.  The  increase  of  labor  is  the  increase  of  mankind ;  of 


154 


POLITICAL  ECONOMY 


population.  On  this  subject  the  discussions  excited  bv  the  Es¬ 
say  of  Mr.  Malthus  have  made  the  truth,  thougfo  bv  no  means 
universally  admitted,  yet  so  fully  known,  that  a  briefer  ex¬ 
amination*  of  the  question  than  would  otherwise  have  been 
necessary  will  probably  on  the  present  occasion  suffice. 

The  power  of  multiplication  inherent  in  all  organic  life  may 
be  regarded  as  Infinite!  There  is  no  one  species  of  vegetable 
oFamimafT  which,  ifthe  earth  were  entirely  abandoned  to  it,  and 
to  the  things  on  which  it  feeds,  would  not  in  a  small  number 
of  years  overspread  every  region  of  the  globe,  of  which  the  cli¬ 
mate  was  compatible  with  its  existence.  The  degree  of  possible 
rapidity  is  different  in  different  orders  of  beings ;  but  in  all  it 
is  sufficient,  for  the  earth  to  be  very  speedily  filled  up.  There 
are  many  species  of  vegetables  of  which  a  single  plant  will 
produce  in  one  year  the  germs  of  a  thousand ;  if  only  two 
come  to  maturity,  in  fourteen  years  the  two  will  have  multiplied 
to  sixteen  thousand  and  more.  It  is  but  a  moderate  case  of  fe¬ 
cundity  in  animals  to  be  capable  of  quadrupling  their  numbers 
in  a  single  year ;  if  they  only  do  as  much  in  half  a  century,  ten 
thousand  will  have  swelled  within  two  centuries  to  upwards  of 
two  millions  and  a  half.  JThe  capacity  of  increase  is  necessarily 
in  a  geometrical  progression :  the  numerical  ratio  alone  is 
different. 

To  this  property  of  organized  beings,  the  human  species 
forms  no  exception.  Its  power  of  increase  is  indefinite,  and 
the  actual  multiplication  would  be  extraordinarily  rapid,  if  the 
power  were  exercised  to  the  utmost.  It  never  is  exercised  to 
the  utmost,  and  yet,  in  the  most  favorable  circumstances  known 
to  exist,  which  are  those  of  a  fertile  region  colonized  from  an 
industrious  and  civilized  community,  population  has  con¬ 
tinued,  for  several  generations,  independently  of  fresh  immigra¬ 
tion,  to  double  itself  in  not  much  more  than  twenty  years.* 
That  the  capacity  of  multiplication  in  the  human  species  ex¬ 
ceeds  even  this,  is  evident  if  we  consider  how  great  is  the  ordi¬ 
nary  number  of  children  to  a  family,  where  the  climate  is  good 
and  early  marriages  usual ;  and  how  small  a  proportion  of  them 
die  before  the  age  of  maturity,  in  the  present  state  of  hygienic 
knowledge,  where  the  locality  is  healthy,  and  the  family  ade- 


*  This  has  been  disputed;  but  the 
highest  estimate  I  have  seen  of  the 
term  which  population  requires  for 
doubling  itself  in  the  United  States,  in¬ 


dependently  of  immigrants  and  of  their 
progeny — that  of  Mr.  Carey — does  pot 
exceed  thirty  years. 


LAW  OF  THE  INCREASE  OF  LABOR 


155 


quately  provided  with  the  means  of  living.  It  is  a  very  low 
estimate  of  the  capacity  of  increase,  if  we  only  assume,  that  in 
a  good  sanitary  condition  of  the  people,  each  generation  may 
be  double  the  number  of  the  generation  which  preceded  it. 

Twenty  or  thirty  years  ago,  these  propositions  might  still 
have  required  considerable  enforcement  and  illustration ;  but 
the  evidence  of  them  is  so  ample  and  incontestable,  that  they 
have  made  their  way  against  all  kinds  of  opposition,  and  may 
now  be  regarded  as  axiomatic :  though  the  extreme  reluctance 
felt  to  admitting  them,  every  now  and  then  gives  birth  to  some 
ephemeral  theory,  speedily  forgotten,  of  a  different  law  of  in¬ 
crease  in  different  circumstances,  through  a  providential  adap¬ 
tation  of  the  fecundity  of  the  human  species  to  the  exigencies 
of  society.*  The  obstacle  to  a  just  understanding  of  the  sub¬ 
ject  does  not  arise  from  these  theories,  but  from  too  confused 
a  notion  of  the  causes  which,  at  most  times  and  places,  keep 
the  actual  increase  of  mankind  so  far  behind  the  capacity. 

§  3.  Those  causes,  nevertheless,  are  in  no  way  mysterious. 
What  prevents  the  population  of  hares  and  rabbits  from  over¬ 
stocking  the  earth?  Not  want  of  fecundity,  but  causes  very 
different:  many  enemies,  and  insufficient  subsistence :  not 
enough  to  eat,  and  liability  to  Dein^eaten.  In  the  human  race. 
which  is  not  generally  subject  to  the  latter  inconvenience,  thp 
equivalents  for  it  are  war  and  disease^.  If  the  multiplication  of 


*  One  of  these  theories,  that  of  Mr. 
Doubleday,  may  be  thought  to  require 
a  passing  notice,  because  it  has  of  late 
obtained  some  followers,  and  because 
it  derives  a  semblance  of  support  from 
the  general  analogies  of  organic  life. 
This  theory  maintains  that  the  fecundity 
of  the  human  animal,  and  of  all  other 
living  beings,  is  in  inverse  proportion 
to  the  quantity  of  nutriment:  that  an 
underfed  population  multiplies  rapidly, 
but  that  all  classes  in  comfortable  cir¬ 
cumstances  are,  by  a  physiological  law, 
so  unprolific,  as  seldom  to  keep  up  their 
numbers  without  being  recruited  from 
a  poorer  class.  There  is  no  doubt  that 
a  positive  excess  of  nutriment,  in  ani¬ 
mals  as  well  as  in  fruit  trees,  is  unfa¬ 
vorable  to  reproduction;  and  it  is  quite 
possible,  though  by  no  means  proved, 
that  the  physiological  conditions  of  fe¬ 
cundity  may  exist  in  the  greatest  de¬ 
gree  when  the  supply  of  food  is  some¬ 
what  stinted.  But  any  one  who  might 
be  inclined  to  draw  from  this,  even  if 
admitted,  conclusions  at  variance  with 
the  principle  of  Mr.  Malthus,  needs  only 
be  invited  to  look  through  a  volume  of 
the  Peerage,  and  observe  the  enormous 
families  almost  universal  in  that  class; 
or  call  to  mind  the  large  families  of  the 


English  clergy,  and  generally  of  the 
middle  classes  of  England.  It  is,  be¬ 
sides,  well  remarked  by  Mr.  Carey,  that, 
to  be  consistent  with  Mr.  Doubleday’s 
theory,  the  increase  of  the  population 
of  the  United  States,  apart  from  immi¬ 
gration,  ought  to  be  one  of  the  slowest 
on  record. 

Mr.  Carey  has  a  theory  of  his  own, 
also  grounded  on  a  physiological  truth, 
that  the  total  sum  of  nutriment  received 
by  an  organized  body  directs  itself,  in 
largest  proportion,  to  the  parts  of  the 
system  which  are  most  used;  from  which 
he  anticipates  a  diminution  in  the  fecun¬ 
dity  of  human  beings,  not  through  more 
abundant  feeding,  but  through  the 
greater  use  of  their  brains  incident  to 
an  advanced  civilization.  There  is  con¬ 
siderable  plausibility  in  this  speculation, 
and  experience  may  hereafter  confirm 
it.  But  the  change  in  the  human  con¬ 
stitution  which  it  supposes,  if  ever  real¬ 
ized,  will  conduce  to  the  expected  effect 
rather  by  rendering  physical  self-re¬ 
straint  easier,  than  by  dispensing  with 
its  necessity;  since  the  most  rapid  known 
rate  of  multiplication  is  quite  compati¬ 
ble  with  a  very  sparing  employment  of 
the  multiplying  power. 


POLITICAL  ECONOMY 


156 


mankind  proceeded  only,  like  that  of  the  other  animals,  from  a 
blind  instinct,  it  would  be  limited  in  the  same  manner  with 
theirs ;  the  birds  would  be  as  numerous  as  the  physical  consti¬ 
tution  of  the  species  admitted  of,  and  the  population  would  be 
kept  down  by  deaths.*  But  the  conduct  of  human  creatures  is 
more  or  less  influenced  by  foresight  of  consequences,  and  by 
impulses  superior  to  mere  animal  instincts :  and  they  do  not, 
therefore,  propagate  like  swine,  but  are  capable,  though  in  very 
unequal  degrees,  of  being  withheld  by  prudence,  or  by  the 
social  affections,  from  giving  existence  to  beings  born  only  to 
misery  and  premature  death.  In  proportion  as  mankind  rise 
above  the  condition  of  the  beasts,  population  is  restrained  by 
the  fear  of  want,  rather  than  by  want  itself.  Even  where  there 
is  no  question  of  starvation,  many  are  similarly  acted  upon  by 
the  apprehension  of  losing  what  have  come  to  be  regarded  as 
the  decencies  of  their  situation  in  life.  Hitherto  no  other  mo¬ 
tives  than  these  two  have  been  found  strong  enough,  in  the 
generality  of  mankind,  to  counteract  the  tendency  to  increase. 
It  has  been  the  practice  of  a  great  majority  of  the  middle  and 
the  poorer  classes,  whenever  free  from  external  control,  to 
marry  as  early,  and  in  most  countries  to  have  as  many  children, 
as  was  consistent  with  maintaining  themselves  in  the  condition 
of  life  which  they  were  born  to,  or  were  accustomed  to  con¬ 
sider  as  theirs.  Among  the  middle  classes,  in  many  individual 
instances,  there  is  an  additional  restraint  exercised  from  the 
desire  of  doing  more  than  maintaining  their  circumstances — 
of  improving  them  ;  but  such  a  desire  is  rarely  found,  or  rarely 
has  that  effect,  in  the  laboring  classes.  If  they  can  bring  up  a 
family  as  they  were  themselves  brought  up,  even  the  prudent 
among  them  are  usually  satisfied.  Too  often  they  do  not  think 
even  of  that,  but  rely  on  fortune,  or  on  the  resources  to  be  found 
in  legal  or  voluntary  charity. 


*  Mr.  Carey  expatiates  on  the  absurd¬ 
ity  of  supposing  that  matter  tends  to  as¬ 
sume  the  highest  form  of  organization, 
the  human,  at  a  more  rapid  rate  than  it 
assumes  the  lower  forms  which  compose 
human  food;  that  human  beings  mul¬ 
tiply  faster  than  turnips  and  cabbages. 
But  the  limit  to  the  increase  of  man¬ 
kind,  according  to  the  doctrine  of  Mr. 
Malthus,  does  not  depend  on  the  power 
of  increase  of  turnips  and  cabbages,  but 
on  the  limited  quantity  of  the  land  on 
which  they  can  be  grown.  So  long  as 
the  quantity  of  land  is  practically  un¬ 
limited,  which  it  is  in  the  United  States, 


and  food,  consequently,  can  be  increased 
at  the  highest  rate  which  is  natural  to 
it,  mankind  also  may,  without  aug¬ 
mented  difficulty  in  obtaining  subsist¬ 
ence,  increase  at  their  highest  rate. 
When  Mr.  Carey  can  show,  not  that  tur¬ 
nips  and  cabbages  but  that  the  soil  it¬ 
self,  or  the  nutritive  elements  contained 
in  it,  tend  naturally  to  multiply,  and 
that,  too,  at  a  rate  exceeding  the  most 
rapid  possible  increase  of  mankind,  he 
will  have  said  something  to  the  purpose. 
Till  then,  this  part,  at  least,  of  his  argu¬ 
ment  may  be  considered  as  non-existent. 


LAW  OF  THE  INCREASE  OF  LABOR 


157 


In  a  very  backward  state  of  society,  like  that  of  Europe  in 
the  Middle  Ages,  and  many  parts  of  Asia  at  present,  popula¬ 
tion  is  kept  down  by  actual  starvation.  The  starvation  does 
not  take  place  in  ordinary  years,  but  in  seasons  of  scarcity, 
which  in  those  states  of  society  are  much  more  frequent  and 
more  extreme  than  Europe  is  now  accustomed  to.  In  these 
seasons  actual  want,  or  the  maladies  consequent  on  it,  carry  off 
numbers  of  the  population,  which  in  a  succession  of  favorable 
years  again  expands,  to  be  again  cruelly  decimated.  In  a  more 
improved  state,  few,  even  among  the  poorest  of  the  people, 
are  limited  to  actual  necessaries,  and  to  a  bare  sufficiency  of 
those:  and  the  increase  is  kept  within  bounds,  not  by  excess 
of  deaths,  but  by  limitation  of  births.  The  limitation  is  brought 
about  in  various  ways.  In  some  countries,  it  is  the  result  of 
prudent  or  conscientious  self-restraint.  There  is  a  condition 
to  which  the  laboring  people  are  habituated  ;  they  perceive  that 
by  having  too  numerous  families,  they  must  sink  below  that 
condition,  or  fail  to  transmit  it  to  their  children ;  and  this  they 
do  not  choose  to  submit  to.  The  countries  in  which,  so  far  as  is 
known,  a  great  degree  of  voluntary  prudence  has  been  longest 
practised  on  this  subject,  are  Norway  and  parts  of  Switzerland. 
Concerning  both,  there  happens  to  be  unusually  authentic  in¬ 
formation  ;  many  facts  were  carefully  brought  together  by  Mr. 
Malthus,  and  much  additional  evidence  has  been  obtained 
since  his  time.  In  both  these  countries  the  increase  of  popula¬ 
tion  is  very  slow ;  and  what  checks  it,  is  not  multitude  of 
deaths,  but  fewness  of  births.  Both  the  births  and  the  deaths 
are  remarkably  few  in  proportion  to  the  population ;  the  aver¬ 
age  duration  of  life  is  the  longest  in  Europe ;  the  population 
contains  fewer  children,  and  a  greater  proportional  number 
of  persons  in  the  vigor  of  life,  than  is  known  to  be  the  case  in 
any  other  part  of  the  world.  The  paucity  of  births  tends  di¬ 
rectly  to  prolong  life,  by  keeping  the  people  in  comfortable 
circumstances ;  and  the  same  prudence  is  doubtless  exercised 
in  avoiding  causes  of  disease,  as  in  keeping  clear  of  the  prin¬ 
cipal  cause  of  poverty.  It  is  worthy  of  remark  that  the  two 
countries  thus  honorably  distinguished,  are  countries  of  small 
landed  proprietors. 

There  are  other  cases  in  which  the  prudence  and  forethought, 
which  perhaps  might  not  be  exercised  by  the  people  them¬ 
selves,  are  exercised  by  the  state  for  their  benefit;  marriage 


POLITICAL  ECONOMY 


158 

not  being  permitted  until  the  contracting  parties  can  show  that 
they  have  the  prospect  of  a  comfortable  support.  Under  these 
laws,  of  which  I  shall  speak  more  fully  hereafter,  the  condition 
of  the  people  is  reported  to  be  good,  and  the  illegitimate  births 
not  so  numerous  as  might  be  expected.  There  are  places, 
again,  in  which  the  restraining  cause  seems  to  be  not  so  much 
individual  prudence,  as  some  general  and  perhaps  even  acci¬ 
dental  habit  of  the  country.  In  the  rural  districts  of  England, 
during  the  last  century,  the  growth  of  population  was  very 
effectually  repressed  by  the  difficulty  of  obtaining  a  cottage  to 
live  in.  It  was  the  custom  for  unmarried  laborers  to  lodge 
and  board  with  their  employers ;  it  was  the  custom  for  mar¬ 
ried  laborers  to  have  a  cottage:  and  the  rule  of  the  English 
poor  laws  by  which  a  parish  was  charged  with  the  support  of 
its  unemployed  poor,  rendered  landowners  averse  to  promote 
marriage.  About  the  end  of  the  century,  the  great  demand 
for  men  in  war  and  manufactures,  made  it  be  thought  a  patri¬ 
otic  thing  to  encourage  population :  and  about  the  same  time 
the  growing  inclination  of  farmers  to  live  like  rich  people, 
favored  as  it  was  by  a  long  period  of  high  prices,  made  them 
desirous  of  keeping  inferiors  at  a  greater  distance,  and  pe¬ 
cuniary  motives  arising  from  abuses  of  the  poor  laws  being 
superadded,  they  gradually  drove  their  laborers  into  cottages, 
which  the  landlords  now  no  longer  refused  permission  to  build. 
In  some  countries  an  old  standing  custom  that  a  girl  should 
not  marry  until  she  had  spun  and  woven  for  herself  an  ample 
trousseau  (destined  for  the  supply  of  her  whole  subsequent 
life),  is  said  to  have  acted  as  a  substantial  check  to  population. 
In  England,  at  present,  the  influence  of  prudence  in  keeping 
down  multiplication  is  seen  by  the  diminished  number  of  mar¬ 
riages  in  the  manufacturing  districts  in  years  when  trade  is  bad. 

But  whatever  be  the  causes  by  which  the  population  is  any¬ 
where  limited  to  a  comparatively  slow  rate  of  increase,  an 
acceleration  of  the  rate  very  speedily  follows  any  diminution  of 
the  motives  to  restraint.  It  is  but  rarely  that  improvements  in 
the  condition  of  the  laboring  classes  do  anything  more  than 
pve  a  temporary  margin,  speedily  filled  up  by  an  increase  of 


their  numbers^  The  use  they  commonly  choose  to  make  of 
any  advantageous  change  in  their  circumstances,  is  to  take" it 
out  in  the  form~which,  bv  augmenting  the  population,  deprives 
succeeding  generation  of  the  benefit.  Unless,  either  by 


LAW  OF  THE  INCREASE  OF  LABOR 


159 


their  general  improvement  in  intellectual  and  moral  culture,  or 
at  least  by  raising  their  habitual  standard  of  comfortable  liv¬ 
ing,  they  can  be  taught  to  make  a  better  use  of  favorable  cir¬ 
cumstances,  nothing  permanent  can  be  done  for  them ;  the 
most  promising  schemes  end  only  in  having  a  more  numerous, 
but  not  a  happier  people.  By  their  habitual  standard,  I  mean 
that  (when  any  such  there  is)  down  to  which  they  will  multiply, 
but  not  lower.  Every  advance  they  make  in  education,  civiliza¬ 
tion,  and  social  improvement,  tends  to  raise  this  standard ;  and 
there  is  no  doubt  that  it  is  gradually,  though  slowly,  rising  in 
the  more  advanced  countries  of  Western  Europe.  Subsistence 
and  employment  in  England  have  never  increased  more  rapidly 
than  in  the  last  forty  years,  but  every  census  since  1821  showed 
a  smaller  proportional  increase  of  population  than  that  of  the 
period  preceding;  and  the  produce  of  French  agriculture  and 
industry  is  increasing  in  a  progressive  ratio,  while  the  popula¬ 
tion  exhibits,  in  every  quinquennial  census,  a  smaller  propor¬ 
tion  of  births  to  the  population. 

The  subject,  however,  of  population,  in  its  connection  with 
the  condition  of  the  laboring  classes,  will  be  considered  in  an¬ 
other  place :  in  the  present,  we  have  to  do  with  it  solely  as  one 
of  the  elements  of  Production :  and  in  that  character  we  could 
not  dispense  with  pointing  out  the  unlimited  extent  of  its 
natural  powers  of  increase,  and  the  causes  owing  to  which  so 
small  a  portion  of  that  unlimited  power  is  for  the  most  part 
actually  exercised.  After  this  brief  indication,  we  shall  proceed 
to  the  other  elements. 

Chapter  XI. — Of  the  Law  of  the  Increase  of  Capital 

§  1.  The  requisites  of  production  being  labor,  capital,  and 
land,  it  has  been  seen  from  the  preceding  chapter  that  the  im¬ 
pediments  to  the  increase  of  production  do  not  arise  from  the 
first  of  these  elements.  On  the  side  of  labor  there  is  no  ob¬ 
stacle  to  an  increase  of  production,  indefinite  in  extent  and  of 
unslackening  rapidity.  Population  has  the  power  of  increasing 
in  a  uniform  and  rapid  geometrical  ratio.  If  the  only  essential 
condition  of  production AverefTabor,  the  produce  might,  and 
naturally  would,  increase  in  the  same  ratio ;  and  there  would 
be  no  limit,  until  the  numbers  of  mankind  were  brought  to  a 
stand  from  actual  want  of  space. 


i6o 


POLITICAL  ECONOMY 


But  production  has  other  requisites,  and  of  these,  the  one 
which  we  shall  next  consider  is  Capital.  There  cannot  be  more 
people  in  any  country,  or  in  the  world,  than  can  be  supported 
from  the  produce  of  past  labor  until  that  of  present  labor  comes 
in.  There  will  be  no  greater  number  of  productive  laborers  in 
any  country,  or  in  the  world,  than  can  be  supported  from  that 
portion  of  the  produce  of  past  labor,  which  is  spared  from  the 
enjoyments  of  its  possessor  for  purposes  of  reproduction,  and 
is  termed  Capital.  We  have  next,  therefore,  to  inquire  into  the 
conditions  of  the  increase  of  capital ;  the  causes  by  which  the 
rapidity  of  its  increase  is  determined,  and  the  necessary  limita¬ 
tions  of  that  increase. 

Since  all  capital  is  the  product  of  saving,  that  is,  of  abstinence 
from  present  consumption  tor  the  sake  of  a  future  good,  the 
increase  of  capital  must  depend  upon  two  things — the  amount 
of  the  fund  from  which  saving  can  be  made,  and  the  strength 
gf  the  dispositions  which  prompt  to  it. 

The  fund  from  which  saving  can  be  made,  is  the  surplus  of 
the  produce  of  labor,  after  supplying  the  necessaries  of  life  to 
all  concerned  in  the  production  (including  those  employed  in 
replacing  the  materials,  and  keeping  the  fixed  capital  in  re¬ 
pair).  More  than  this  surplus  cannot  be  saved  under  any  cir¬ 
cumstances.  As  much  as  this,  though  it  never  is  saved,  always 
might  be.  This  surplus  is  the  fund  from  which  the  enjoyments, 
as  distinguished  from  the  necessaries  of  the  producers,  are 
provided ;  it  is  the  fund  from  which  all  are  subsisted,  who  are 
not  themselves  engaged  in  production ;  and  from  which  all 
additions  are  made  to  capital.  It  is  the  real  net  produce  of  the 
country.  The  phrase,  net  produce,  is  often  taken  in  a  more 
limited  sense,  to  denote  only  the  profits  of  the  capitalist  and  the 
rent  of  the  landlord,  under  the  idea  that  nothing  can  be  included 
in  the  net  produce  of  capital,  but  what  is  returned  to  the  owner 
of  the  capital  after  replacing  his  expenses.  But  this  is  too  nar¬ 
row  an  acceptation  of  the  term.  The  capital  of  the  employer 
forms  the  revenue  of  the  laborers,  and  if  this  exceeds  the  neces¬ 
saries  of  life,  it  gives  them  a  surplus  which  they  may  either 
expend  in  enjoyments  or  save.  For  every  purpose  for  which 
there  can  be  occasion  to  speak  of  the  rtet  produce  of  industry, 
this  surplus  ought  to  be  included  in  it.  When  this  is  included, 
and  not  otherwise,  the  net  produce  of  the  country  is  the  meas¬ 
ure  of  its  effective  power ;  of  what  it  can  spare  for  any  pur- 


LAW  OF  THE  INCREASE  OF  CAPITAL 


161 


poses  of  public  utility,  or  private  indulgence ;  the  portion  of 
its  produce  of  which  it  can  dispose  at  pleasure ;  which  can  be 
drawn  upon  to  attain  any  ends,  or  gratify  any  wishes,  either 
of  the  government  or  of  individuals  ;  which  it  can  either  spend 
for  its  satisfaction,  or  save  for  future  advantage. 

Tin  amount  of  this  fund,  this  net  produce,  this  excess  of  pro¬ 
duction  above  the  physical  necessaries  of  the  producers,  is  one 
of  the  elements  that  determine  the  amount  of  saving.  Thq 

greater  the  produce  oTlabor  after  supporting  the  laborers,  the 
more  there  is  which  can  be  saved.  The  same  thing  also  partly 

contributes  to  determine  how  much  will  be  saved.  A  part  of 

the  motive  to  saving  consists  in  the  prospect  of  deriving  an 

income  from  savings ;  in  the  fact  that  capital,  employed  in 

production,  is  capable*  of  not  only  reproducing  itself  but  yield¬ 
ing  an  increase.  The  greater  the  profit  that  can  be  made  from 
capital,  the  stronger  is  the  motive  to  its  accumulation.  That 
indeed^HT(!!rforms  th^indtrcement  to  save/is  not  the  whole 
'oTthefund  which  supplies  the  means  of  saving,  not  the  whole  , 
net  produce  of  the  land,  capital,  and  labor  of  the  country,  but 
only  a  part  of  it,lhe  part  which  forms  the  remuneration  of  the 
capitalisT,  anlTTs  called  profit  of  stock.  *  It  will,  however,  be 
readily  enough  understood,  even  previously  to  the  explanations 
which  will  be  given  hereafter,  that  when  the  general  produc¬ 
tiveness  of  labor  and  capital  is  great,  the  returns  to  the  capitalist 
are  likely  to  be  large,  and  that  some  proportion,  though  not  a 
uniform  one,  will  commonly  obtain  between  the  two. 

§  2.  ffutthe  disposition  to  save  does  not  wholly  depend  on  the 
external  inducement  to  it ;  on  the  amount  of  profit  to  be  made 

from  savings.  With  the  same  pecuniary  inducement,  the  irj- 

cl mating  Is  very  different,  in  different  persons,  and  in  different 
communities.  The  effective  desire  of  accumulation  is  of  un- 
equal  strength,  not  only  according  to  the  varieties  of  indi¬ 
vidual  character,  but  to  the  general  state  of  society  and  civili¬ 
zation.  Like  all  other  moral  attributes,  it  is  one  in  which  the 
human  race  exhibits  great  differences,  conformably  to  the 
diversity  of  its  circumstances  and  the  stage  of  its  progress. 

On  topics  which  if  they  were  to  be  fully  investigated  would 
exceed  the  bounds  that  can  be  allotted  to  them  in  this  treatise, 
it  is  satisfactory  to  be  able  to  refer  to  other  works  in  which  the 
necessary  developments  have  been  presented  more  at  length. 

On  the  subject  of  Population  this  valuable  service  has  been 
Vol.  I.— II 


i62 


POLITICAL  ECONOMY 


rendered  by  the  celebrated  Essay  of  Mr.  Malthus ;  and  on  the 
point  which  now  occupies  us  I  can  refer  with  equal  confidence 
to  another,  though  a  less  known  work,  “  New  Principles  of 
Political  Economy/’  by  Dr.  Rae.*  In  no  other  book  known  to 
me  is  so  much  light  thrown,  both  from  principle  and  history, 
on  the  causes  which  determine  the  accumulation  of  capital. 

All  accumulation  involves  the  sacrifice  of  a  present,  for  the 
sake1  of  a  future  good.  But  the  expediency  of  suck  a  sacrifice 
varies  very  much  in  different  states-oLcircumstances  :  and  the 
willingness  to  make  itr  varies  still  more. 

In  weighing. the  .future  against  the  present,  the  uncertainty 
of  aUthings  future  is  a  leading  element ;  and  that  uncertainty 
is  of  verx different  degrees.  “All  circumstances,”  therefore, 
“  increasing  the  probability  of  the  provision  we  make  for  fu¬ 
turity  being  enjoyed  by  ourselves  or  others,  tend  ”  justly  and 
reasonably  “  to  give  strength  to  the  effective  desire  of  accumu¬ 
lation.  Thus  a  healthy  climate  or  occupation,  by  increasing 
the  probability  of  life,  has  a  tendency  to  add  to  this  desire. 
When  engaged  in  safe  occupations,  and  living  in  healthy  coun¬ 
tries,  men  are  much  more  apt  to  be  frugal  than  in  unhealthy 
or  hazardous  occupations,  and  in  climates  pernicious  to  human 
life.  Sailors  and  soldiers  are  prodigals.  In  the  West  Indies, 
New  Orleans,  the  East  Indies,  the  expenditure  of  the  inhabi¬ 
tants  is  profuse.  The  same  people,  coming  to  reside  in  the 
healthy  parts  of  Europe,  and  not  getting  into  the  vortex  of  ex¬ 
travagant  fashion,  live  economically.  War  and  pestilence  have 
always  waste  and  luxury  among  the  other  evils  that  follow  in 
their  train.  For  similar  reasons,  whatever  gives  security  to  the 
affairs  of  the  community  is  favorable  to  the  strength  of  this 
principle.  In  this  respect  the  general  prevalence  of  law  and 
order,  and  the  prospect  of  the  continuance  of  peace  and  tran- 


*  This  treatise  is  an  example,  such  as 
not  unfrequently  presents  itself,  how 
much  more  depends  on  accident,  than 
on  the  qualities  of  a  book,  in  determin¬ 
ing  its  reception.  Had  it  appeared  at  a 
suitable  time,  and  been  favored  by  cir¬ 
cumstances,  it  would  have  had  every 
requisite  for  great  success.  The  author, 
a  Scotchman  settled  in  the  United 
States,  unites  much  knowledge,  an  orig¬ 
inal  vein  of  thought,  a  considerable 
turn  for  philosophic  generalities,  and  a 
manner  of  exposition  and  illustration 
calculated  to  make  ideas  tell  not  only 
for  what  they  are  worth,  but  for  more 
than  they  are  worth,  and  which  some¬ 
times,  I  think,  has  that  effect  in  the 
writer’s  own  mind.  The  principal  fault 


of  the  book  is  the  position  of  antagonism 
in  which,  with  the  controversial  spirit 
apt  to  be  found  in  those  who  have  new 
thoughts  on  old  subjects,  he  has  placed 
himself  towards  Adam  Smith.  I  call 
this  a  fault  (though  I  think  many  of  the 
criticisms  just,  and  some  of  them  far- 
seeing),  because  there  is  much  less  real 
difference  of  opinion  than  might  be  sup¬ 
posed  from  Dr.  Rae’s  animadversions; 
and  because  what  he  has  found  vulner¬ 
able  in  his  great  predecessor  is  chiefly 
the  “  human  too-much  ”  in  his  prem¬ 
ises;  the  portion  of  them  that  is  over 
and  above  what  was  either  required  or 
is  actually  vised  for  the  establishment  of 
his  conclusions. 


LAW  OF  THE  INCREASE  OF  CAPITAL 


163 


quillity,  have  considerable  influence.”  *  The  more  perfect  the 
security,  the  greater  will  be  the  effective  strength  of  the  desire 
of  accumulation.  Where  property  is  less  safe,  or  the  vicissi¬ 
tudes  ruinous  to  fortunes  are  more  frequent  and  severe,  fewer 
persons  will  save  at  all,  and  of  those  who  do,  many  will  require 
the  inducement  of  a  higher  rate  of  profit  on  capital,  to  make 
them  prefer  a  doubtful  future  to  the  temptation  of  present  en¬ 
joyment. 

These  are  considerations  which  affect  the  expediency,  in  the 
eye  of  reason,  of  consulting  future  interests  at  the  expense  of 
present.  But  the  inclination  to  make  this  sacrifice  does  not 
solely  depend  upon  its  expediency.  The  disposition  to  save  is 
often  far  short  of  what  reason  would  dictate :  and  at  other 
times  is  liable  to  be  in  excess  of  it. 

Deficient  strength  of  the  desire  of  accumulation  may  arise 
from  improvidence,  or  from  want  of  interest  in  others.  Im¬ 
providence  may  be  connected  with  intellectual  as  well  as  moral 
causes.  Individuals  and  communities  of  a  very  low  state  of 
intelligence  are  always  improvident.  A  certain  measure  of 
intellectual  development  seems  necessary  to  enable,  absent 
things,  and  especially  things  future,  to  act  with  any  force  on 
the  imagination  and  will.  The  effect  of  want  of  interest  in 
others  in  diminishing  accumulation,  will  be  admitted,  if 
we  consider  how  much  saving  at  present  takes  place,  which 
has  for  its  object  the  interest  of  others  rather,  than  of  our¬ 
selves  ;  the  education  of  children,  their  advancement  in  life, 
the  future  interests  of  other  personal  connections,  the  power 
of  promoting  by  the  bestowal  of  money  or  time,  objects  of 
public  or  private  usefulness.  If  mankind  were  generally  in 
the  state  of  mind  to  which  some  approach  was  seen  in  the 
declining  period  of  the  Roman  empire — caring  nothing  for 
their  heirs,  as  well  as  nothing  for  friends,  the  public,  or  any 
object  which  survived  them — they  would  seldom  deny  them¬ 
selves  any  indulgence  for  the  sake  of  saving,  beyond  what  was 
necessary  for  their  own  future  years ;  which  they  would  place 
in  life  annuities,  or  in  some  other  form  which  would  make  its 
existence  and  their  lives  terminate  together. 

§  3.  From  these  various  causes,  intellectual  and  moral,  there 
is,  in  different  portions  of  the  human  race,  a  greater  diversity 
than  is  usually  adverted  to,  in  the  strength  of  the  effective  de- 

*  Rae,  p.  123. 


164 


POLITICAL  ECONOMY 


sire  of  accumulation.  A  backward  state  of  general  civilization 
is  often  more  the  effect  of  deficiency  in  this  particular  than 
in  many  others  which  attract  more  attention.  In  the  circum¬ 
stances,  for  example,  of  a  hunting  tribe,  “  man  may  be  said  to 
be  necessarily  improvident,  and  regardless  of  futurity,  because, 
in  this  state,  the  future  presents  nothing  which  can  be  with 
certainty  either  foreseen  or  governed.  .  .  .  Besides  a  want 
of  the  motives  exciting  to  provide  for  the  needs  of  futurity 
through  means  of  the  abilities  of  the  present,  there  is  a  want 
of  the  habits  of  perception  and  action,  leading  to  a  constant 
connection  in  the  mind  of  those  distant  points,  and  of  the  series 
of  events  serving  to  unite  them.  Even,  therefore,  if  motives  be 
awakened  capable  of  producing  the  exertion  necessary  to  ef¬ 
fect  this  connection,  there  remains  the  task  of  training  the  mind 
to  think  and  act  so  as  to  establish  it.” 

For  instance :  “  Upon  the  banks  of  the  St.  Lawrence  there 
are  several  little  Indian  villages.  They  are  surrounded,  in  gen¬ 
eral,  by  a  good  deal  of  land,  from  which  the  wood  seems  to 
have  been  long  extirpated,  and  have,  besides,  attached  to  them, 
extensive  tracts  of  forest.  The  cleared  land  is  rarely,  I  may 
almost  say  never,  cultivated,  nor  are  any  inroads  made  in  the 
forest  for  such  a  purpose.  The  soil  is,  nevertheless,  fertile,  and 
were  it  not,  manure  lies  in  heaps  by  their  houses.  Were  every 
family  to  inclose  half  an  acre  of  ground,  till  it,  and  plant  it  in 
potatoes  and  maize,  it  would  yield  a  sufficiency  to  support  them 
one-half  the  year.  They  suffer,  too,  every  now  and  then,  ex¬ 
treme  want,  insomuch  that,  joined  to  occasional  intemperance, 
it  is  rapidly  reducing  their  numbers.  This,  to  us,  so  strange 
apathy  proceeds  not,  in  any  great  degree,  from  repugnance  to 
labor ;  on  the  contrary,  they  apply  very  diligently  to  it  when  its 
reward  is  immediate.  Thus,  besides  their  peculiar  occupations 
of  hunting  and  fishing,  in  which  they  are  ever  ready  to  engage, 
they  are  much  employed  in  the  navigation  of  the  St.  Lawrence, 
and  may  be  seen  laboring  at  the  oar,  or  setting  with  the  pole, 
in  the  large  boats  used  for  the  purpose,  and  always  furnish  the 
greater  part  of  the  additional  hands  necessary  to  conduct  rafts 
through  some  of  the  rapids.  Nor  is  the  obstacle  aversion  to 
agricultural  labor.  This  is  no  doubt  a  prejudice  of  theirs ;  but 
mere  prejudices  always  yield,  principles  of  action  cannot  be 
created.  When  the  returns  from  agricultural  labor  are  speedy 
and  great,  they  are  also  agriculturists.  Thus,  some  of  the  little 


LAW  OF  THE  INCREASE  OF  CAPITAL 


i65 


islands  on  Lake  St.  Francis,  near  the  Indian  village  of  St. 
Regis,  are  favorable  to  the  growth  of  maize,  a  plant  yielding  a 
return  of  a  hundredfold,  and  forming,  even  when  half  ripe,  a 
pleasant  and  substantial  repast.  Patches  of  the  best  land  on 
these  islands  are,  therefore,  every  year  cultivated  by  them  for 
this  purpose.  As  their  situation  renders  them  inaccessible  to 
cattle,  no  fence  is  required ;  were  this  additional  outlay  neces¬ 
sary,  I  suspect  they  would  be  neglected,  like  the  commons  ad¬ 
joining  their  village.  These  had  apparently  at  one  time,  been 
under  crop.  The  cattle  of  the  neighboring  settlers  would  now, 
however,  destroy  any  crop  not  securely  fenced,  and  this  addi¬ 
tional  necessary  outlay  consequently  bars  their  culture.  It 
removes  them  to  an  order  of  instruments  of  slower  return  than 
that  which  corresponds  to  the  strength  of  the  effective  desire 
of  accumulation  in  this  little  society. 

“  It  is  here  deserving  of  notice,  that  what  instruments  of  this 
kind  they  do  form,  are  completely  formed.  The  small  spots  of 
corn  they  cultivate  are  thoroughly  weeded  and  hoed.  A  little 
neglect  in  this  part  would  indeed  reduce  the  crop  very  much ; 
of  this  experience  has  made  them  perfectly  aware,  and  they  act 
accordingly.  It  is  evidently  not  the  necessary  labor  that  is  the 
obstacle  to  more  extended  culture,  but  the  distant  return  from 
that  labor.  I  am  assured,  indeed,  that  among  some  of  the  more 
remote  tribes,  the  labor  thus  expended  much  exceeds  that 
given  by  the  whites.  The  same  portions  of  ground  being 
cropped  without  remission,  and  manure  not  being  used,  they 
would  scarcely  yield  any  return,  were  not  the  soil  most  carefully 
broken  and  pulverized,  both  with  the  hoe  and  the  hand.  In 
such  a  situation  a  white  man  would  clear  a  fresh  piece  of 
ground.  It  would  perhaps  scarce  repay  his  labor  the  first  year, 
and  he  would  have  to  look  for  his  reward  in  succeeding  years. 
On  the  Indian,  succeeding  years  are  too  distant  to  make  suffi¬ 
cient  impression ;  though,  to  obtain  what  labor  may  bring 
about  in  the  course  of  a  few  months,  he  toils  even  more  assid¬ 
uously  than  the  white  man.”  * 

This  view  of  things  is  confirmed  by  the  experience  of  the 
jesuits,  in  their  interesting  efforts  to  civilize  the  Indians  of 
Paraguay.  They  gained  the  confidence  of  these  savages  in  a 
most  extraordinary  degree.  They  acquired  influence  over 
them  sufficient  to  make  them  change  their  whole  manner  of  life. 


*  Rae,  p.  136. 


1 66 


POLITICAL  ECONOMY 


They  obtained  their  absolute  submission  and  obedience.  They 
established  peace.  They  taught  them  all  the  operations  of 
European  agriculture,  and  many  of  the  more  difficult  arts. 
There  were  everywhere  to  be  seen,  according  to  Charlevoix, 
“  workshops  of  gilders,  painters,  sculptors,  goldsmiths,  watch¬ 
makers,  carpenters,  joiners,  dyers,”  etc.  These  occupations 
were  not  practised  for  the  personal  gain  of  the  artificers :  the 
produce  was  at  the  absolute  disposal  of  the  missionaries,  who 
ruled  the  people  by  a  voluntary  despotism.  The  obstacles 
arising  from  aversion  to  labor  were  therefore  very  completely 
overcome.  The  real  difficulty  was  the  improvidence  of  the  peo¬ 
ple  ;  their  inability  to  think  for  the  future ;  and  the  necessity 
accordingly  of  the  most  unremitting  and  minute  superinten¬ 
dence  on  the  part  of  their  instructors.  “  Thus  at  first,  if  these 
gave  up  to  them  the  care  of  the  oxen  with  which  they  ploughed, 
their  indolent  thoughtlessness  would  probably  leave  them  at 
evening  still  yoked  to  the  implement.  Worse  than  this,  in¬ 
stances  occurred  where  they  cut  them  up  for  supper,  thinking, 
when  reprehended,  that  they  sufficiently  excused  themselves 
by  saying  they  were  hungry.  .  .  .  These  fathers,  says  Ulloa, 
have  to  visit  the  houses,  to  examine  what  is  really  wanted : 
for,  without  this  care,  the  Indians  would  never  look  after  any¬ 
thing.  They  must  be  present,  too,  when  animals  are  slaugh¬ 
tered,  not  only  that  the  meat  may  be  equally  divided,  but  that 
nothing  may  be  lost.”  “  But  notwithstanding  all  this  care  and 
superintendence,”  says  Charlevoix,  “  and  all  the  precautions 
which  are  taken  to  prevent  any  want  of  the  necessaries  of  life, 
the  missionaries  are  sometimes  much  embarrassed.  It  often 
happens  that  they  ”  (the  Indians)  “  do  not  reserve  to  themselves 
a  sufficiency  of  grain,  even  for  seed.  As  for  their  other  provi¬ 
sions,  were  they  not  well  looked  after,  they  would  soon  be  with¬ 
out  wherewithal  to  support  life.”  * 

As  an  example  intermediate,  in  the  strength  of  the  effective 
desire  of  accumulation,  between  the  state  of  things  thus  de¬ 
picted  and  that  of  modern  Europe,  the  case  of  the  Chinese  de¬ 
serves  attention.  From  various  circumstances  in  their  per¬ 
sonal  habits  and  social  condition,  it  might  be  anticipated  that 
they  would  possess  a  degree  of  prudence  and  self-control 
greater  than  other  Asiatics,  but  inferior  to  most  European  na¬ 
tions  ;  and  the  following  evidence  is  adduced  of  the  fact : 

*  Rae,  p.  140. 


LAW  OF  THE  INCREASE  OF  CAPITAL 


167 


“  Durability  is  one  of  the  chief  qualities,  marking  a  high  de¬ 
gree  of  the  effective  desire  of  accumulation.  The  testimony 
of  travellers  ascribes  to  the  instruments  formed  by  the  Chinese 
a  very  inferior  durability  to  similar  instruments  constructed 
by  Europeans.  The  houses,  we  are  told,  unless  of  the  higher 
ranks,  are  in  general  of  unburnt  bricks,  of  clay,  or  of  hurdles 
plastered  with  earth  ;  the  roofs,  of  reeds  fastened  to  laths.  We 
can  scarcely  conceive  more  unsubstantial  or  temporary  fabrics. 
Their  partitions  are  of  paper,  requiring  to  be  renewed  every 
year.  A  similar  observation  may  be  made  concerning  their 
implements  of  husbandry,  and  other  utensils.  They  are  almost 
entirely  of  wood,  the  metals  entering  but  very  sparingly  into 
their  construction ;  consequently  they  soon  wear  out,  and  re¬ 
quire  frequent  renewals.  A  greater  degree  of  strength  in  the 
effective  desire  of  accumulation,  would  cause  them  to  be  con¬ 
structed  of  materials  requiring  a  greater  present  expenditure, 
but  being  far  more  durable.  From  the  same  cause,  much  land, 
that  in  other  countries  would  be  cultivated,  lies  waste.  All 
travellers  take  notice  of  large  tracts  of  lands,  chiefly  swamps, 
which  continue  in  a  state  of  nature.  To  bring  a  swamp  into 
tillage  is  generally  a  process,  to  complete  which,  requires  sev¬ 
eral  years.  It  must  be  previously  drained,  the  surface  long 
exposed  to  the  sun,  and  many  operations  performed,  before  it 
can  be  made  capable  of  bearing  a  crop.  Though  yielding, 
probably,  a  very  considerable  return  for  the  labor  bestowed  on 
it,  that  return  it  not  made  until  a  long  time  has  elapsed.  The 
cultivation  of  such  land  implies  a  greater  strength  of  the  effec¬ 
tive  desire  of  accumulation  than  exists  in  the  empire. 

“  The  produce  of  the  harvest  is,  as  we  have  remarked,  always 
an  instrument  of  some  order  or  another ;  it  is  a  provision  for 
future  want,  and  regulated  by  the  same  laws  as  those  to  which 
other  means  of  attaining  a  similar  end  conform.  It  is  there 
chiefly  rice,  of  which  there  are  two  harvests,  the  one  in  June, 
the  other  in  October.  The  period  then  of  eight  months  be¬ 
tween  October  and  June,  is  that  for  which  provision  is  made 
each  year,  and  the  different  estimate  they  make  of  to-day  and 
this  day  eight  months  will  appear  in  the  self-denial  they  prac¬ 
tise  now,  in  order  to  guard  against  want  then.  The  amount  of 
this  self-denial  would  seem  to  be  small.  The  father  Parennin, 
indeed,  (who  seems  to  have  been  one  of  the  most  intelligent  of 
the  Jesuits,  and  spent  a  long  life  among  the  Chinese  of  all 


i68 


POLITICAL  ECONOMY 


classes,)  asserts,  that  it  is  their  great  deficiency  in  forethought 
and  frugality  in  this  respect,  which  is  the  cause  of  the  scarcities 
and  famines  that  frequently  occur.” 

That  it  is  defect  of  providence,  not  defect  of  industry,  that 
limits  production  among  the  Chinese,  is  still  more  obvious  than 
in  the  case  of  the  semi-agriculturalized  Indians.  “  Where  the 
returns  are  quick,  where  the  instruments  formed  require  but 
little  time  to  bring  the  events  for  which  they  were  formed  to 
an  issue,”  it  is  well  known  that  “  the  great  progress  which  has 
been  made  in  the  knowledge  of  the  arts  suited  to  the  nature  of 
the  country  and  the  wants  of  its  inhabitants  ”  makes  industry 
energetic  and  effective.  “  The  warmth  of  the  climate,  the  natu¬ 
ral  fertility  of  the  country,  the  knowledge  which  the  inhabi¬ 
tants  have  acquired  of  the  arts  of  agriculture,  and  the  discovery 
and  gradual  adaptation  to  every  soil  of  the  most  useful  vege¬ 
table  productions,  enable  them  very  speedily  to  draw  from  al¬ 
most  any  part  of  the  surface,  what  is  there  esteemed  an  equiva¬ 
lent  to  much  more  than  the  labor  bestowed  in  tilling  and 
cropping  it.  They  have  commonly  double,  sometimes  treble  har¬ 
vests.  These,  when  they  consist  of  a  grain  so  productive  as 
rice,  the  usual  crop,  can  scarce  fail  to  yield  to  their  skill,  from 
almost  any  portion  of  soil  that  can  be  at  once  brought  into 
culture,  very  ample  returns.  Accordingly  there  is  no  spot  that 
labor  can  immediately  bring  under  cultivation  that  is  not  made 
to  yield  to  it.  Hills,  even  mountains  are  ascended  and  formed 
into  terraces ;  and  water,  in  that  country  the  great  productive 
agent,  is  led  to  every  part  by  drains,  or  carried  up  to  it  by 
the  ingenious  and  simple  hydraulic  machines  which  have  been 
in  use  from  time  immemorial  among  this  singular  people. 
They  effect  this  the  more  easily,  from  the  soil,  even  in  these 
situations,  being  very  deep  and  covered  with  much  vegetable 
mould.  But  what  yet  more  than  this  marks  the  readiness  with 
which  labor  is  forced  to  form  the  most  difficult  materials  into 
instruments,  where  these  instruments  soon  bring  to  an  issue 
the  events  for  which  they  are  formed,  is  the  frequent  occurrence 
on  many  of  their  lakes  and  rivers,  of  structures  resembling  the 
floating  gardens  of  the  Peruvians,  rafts  covered  with  vegetable 
soil  and  cultivated.  Labor  in  this  way  draws  from  the  materials 
on  which  it  acts  very  speedy  returns.  Nothing  can  exceed  the 
luxuriance  of  vegetation  when  the  quickening  powers  of  a 
genial  sun  are  ministered  to  by  a  rich  soil  and  abundant  mois- 


LAW  OF  THE  INCREASE  OF  CAPITAL 


169 


ture.  It  is  otherwise,  as  we  have  seen,  in  cases  where  the  re¬ 
turn,  though  copious,  is  distant.  European  travellers  are  sur¬ 
prised  at  meeting  these  little  floating  farms  by  the  side  of 
swamps  which  only  require  draining  to  render  them  tillable. 
It  seems  to  them  strange  that  labor  should  not  rather  be  be¬ 
stowed  on  the  solid  earth,  where  its  fruits  might  endure,  than 
on  structures  that  must  decay  and  perish  in  a  few  years.  The 
people  they  are  among  think  not  so  much  of  future  years,  as 
of  the  present  time.  The  effective  desire  of  accumulation  is  of 
very  different  strength  in  the  one,  from  what  it  is  in  the  other. 
The  views  of  the  European  extend  to  a  distant  futurity,  and  he 
is  surprised  at  the  Chinese,  condemned,  through  improvidence, 
and  want  of  sufficient  prospective  care,  to  incessant  toil,  and  as 
he  thinks,  insufferable  wretchedness.  The  views  of  the  Chinese 
are  confined  to  narrower  bounds ;  he  is  content  to  live  from 
day  to  day,  and  has  learnt  to  conceive  even  a  life  of  toil  a 
blessing.”  * 

When  a  country  has  carried  production  as  far  as  in  the  ex¬ 
isting  state  of  knowledge  it  can  be  carried  with  an  amount  of 
return  corresponding  to  the  average  strength  of  the  effective 
desire  of  accumulation  in  that  country,  it  has  reached  what  is 
called  the  stationary  state ;  the  state  in  which  no  further  addi¬ 
tion  will  be  made  to  capital  unless  there  takes  place  either  some 
improvement  in  the  arts  of  production,  or  an  increase  in  the 
strength  of  the  desire  to  accumulate.  In  the  stationary  state, 
though  capital  does  not  on  the  whole  increase,  some  persons 
grow  richer  and  others  poorer.  Those  whose  degree  of  provi¬ 
dence  is  below  the  usual  standard,  become  impoverished,  their 
capital  perishes,  and  makes  room  for  the  savings  of  those 
whose  effective  desire  of  accumulation  exceeds  the  average. 
These  become  the  natural  purchasers  of  the  land,  manufac¬ 
tories,  and  other  instruments  of  production  owned  by  their 
less  provident  countrymen. 

What  the  causes  are  which  make  the  return  to  capital  greater 
in  one  country  than  in  another,  and  which,  in  certain  circum¬ 
stances,  make  it  impossible  for  any  additional  capital  to  find 
investment  unless  at  diminished  returns,  will  appear  clearly 
hereafter.  In  China,  if  that  country  has  really  attained,  as  it 
is  supposed  to  have  done,  the  stationary  state,  accumulation  has 
stopped  when  the  returns  to  capital  are  still  as  high  as  is  indi- 

*  Rae,  pp.  151—5. 


170 


POLITICAL  ECONOMY 


cated  by  a  rate  of  interest  legally  twelve  per  cent.,  and  practi¬ 
cally  varying  (it  is  said)  between  eighteen  and  thirty-six.  It 
is  to  be  presumed  therefore  that  no  greater  amount  of  capital 
than  the  country  already  possesses,  can  find  employment  at  this 
high  rate  of  profit,  and  that  any  lower  rate  does  not  hold  out 
to  a  Chinese  sufficient  temptation  to  induce  him  to  abstain  from 
present  enjoyment.  What  a  contrast  with  Holland,  where, 
during  the  most  flourishing  period  of  its  history,  the  govern¬ 
ment  was  able  habitually  to  borrow  at  two  per  cent.,  and  private 
individuals,  on  good  security,  at  three.  Since  China  is  not  a 
country  like  Burmah,  or  the  native  states  of  India,  where  an 
enormous  interest  is  but  an  indispensable  compensation  for  the 
risk  incurred  from  the  bad  faith  or  poverty  of  the  state,  and 
of  almost  all  private  borrowers ;  the  fact,  if  fact  it  be,  that  the 
increase  of  capital  has  come  to  a  stand  while  the  returns  to  it  are 
still  so  large,  denotes  a  much  less  degree  of  the  effective  de¬ 
sire  of  accumulation,  in  other  words  a  much  lower  estimate 
of  the  future  relatively  to  the  present,  than  that  of  most  Euro¬ 
pean  nations. 

§  4.  We  have  hitherto  spoken  of  countries  in  which  the  aver¬ 
age  strength  of  the  desire  to  accumulate  is  short  of  that  which, 
in  circumstances  of  any  tolerable  security,  reason  and  sober 
calculation  would  approve.  We  have  now  to  speak  of  others 
in  which  it  decidedly  surpasses  that  standard.  In  the  more 
prosperous  countries  of  Europe,  there  are  to  be  found  abun¬ 
dance  of  prodigals;  in  some  of  them  (and  in  none  more  than 
England)  the  ordinary  degree  of  economy  and  providence 
among  those  who  live  by  manual  labor  cannot  be  considered 
high ;  still,  in  a  very  numerous  portion  of  the  community,  the 
professional,  manufacturing,  and  trading  classes,  being  those 
who,  generally  speaking,  unite  more  of  the  means  with  more 
of  the  motives  for  saving  than  any  other  class,  the  spirit  of 
accumulation  is  so  strong,  that  the  signs  of  rapidly  increasing 
wealth  meet  every  eye :  and  the  great  amount  of  capital  seeking 
investment  excites  astonishment,  whenever  peculiar  circum¬ 
stances  turning  much  of  it  into  some  one  channel,  such  as  rail¬ 
way  construction  or  foreign  speculative  adventure,  bring  the 
largeness  of  the  total  amount  into  evidence. 

There  are  many  circumstances,  which,  in  England,  give  a 
peculiar  force  to  the  accumulating  propensity.  The  long  ex¬ 
emption  of  the  country  from  the  ravages  of  war,  and  the  far 


LAW  OF  THE  INCREASE  OF  CAPITAL 


171 

earlier  period  than  elsewhere  at  which  property  was  secure  from 
military  violence  or  arbitrary  spoliation,  have  produced  a  long¬ 
standing  and  hereditary  confidence  in  the  safety  of  funds  when 
trusted  out  of  the  owner’s  hands,  which  in  most  other  countries 
is  of  much  more  recent  origin,  and  less  firmly  established.  The 
geographical  causes  which  have  made  industry  rather  than  war 
the  natural  source  of  power  and  importance  to  Great  Britain, 
have  turned  an  unusual  proportion  of  the  most  enterprising 
and  energetic  characters  into  the  direction  of  manufactures  and 
commerce;  into  supplying  their  wants  and  gratifying  their 
ambition  by  producing  and  saving,  rather  than  by  appropriating 
what  has  been  produced  and  saved.  Much  also  depended  on 
the  better  political  institutions  of  this  country,  which  by  the 
scope  they  have  allowed  to  individual  freedom  of  action,  have 
encouraged  personal  activity  and  self-reliance,  while  by  the  lib¬ 
erty  they  confer  of  association  and  combination,  they  facilitate 
industrial  enterprise  on  a  large  scale.  The  same  institutions 
in  another  of  their  aspects,  give  a  most  direct  and  potent  stim¬ 
ulus  to  the  desire  of  acquiring  wealth.  The  earlier  decline  of 
feudalism  having  removed  or  much  weakened  invidious  dis¬ 
tinctions  between  the  originally  trading  classes  and  those  who 
had  been  accustomed  to  despise  them;  and  a  polity  having 
grown  up  which  made  wealth  the  real  source  of  political  influ¬ 
ence  ;  its  acquisition  was  invested  with  a  factitious  value,  inde¬ 
pendent  of  its  intrinsic  utility.  It  became  synonymous  with 
power;  and  since  power  with  the  common  herd  of  mankind 
gives  power,  wealth  became  the  chief  source  of  personal  con¬ 
sideration,  and  the  measure  and  stamp  of  success  in  life.  To 
get  out  of  one  rank  in  society  into  the  next  above  it,  is  the  great 
aim  of  English  middle-class  life,  and  the  acquisition  of  wealth 
the  means.  And  inasmuch  as  to  be  rich  without  industry,  has 
always  hitherto  constituted  a  step  in  the  social  scale  above  those 
who  are  rich  by  means  of  industry,  it  becomes  the  object  of 
ambition  to  save  not  merely  as  much  as  will  afford  a  large  in¬ 
come  while  in  business,  but  enough  to  retire  from  business  and 
live  in  affluence  on  realized  gains.  These  causes  have  in  Eng¬ 
land  been  greatly  aided  by  that  extreme  incapacity  of  the  people 
for  personal  enjoyment,  which  is  a  characteristic  of  countries 
over  which  Puritanism  has  passed.  But  if  accumulation  is,  on 
one  hand,  rendered  easier  by  the  absence  of  a  taste  for  pleasure, 
it  is,  on  the  other,  made  more  difficult  by  the  presence  of  a 


172 


POLITICAL  ECONOMY 


very  real  taste  for  expense.  So  strong  is  the  association  be¬ 
tween  personal  consequence  and  the  signs  of  wealth,  that  the 
silly  desire  for  the  appearance  of  a  large  expenditure  has  the 
force  of  a  passion,  among  large  classes  of  a  nation  which  derive 
less  pleasure  than  perhaps  any  other  in  the  world  from  what 
it  spends.  Owing  to  this  circumstance,  the  effective  desire  of 
accumulation  has  never  reached  so  high  a  pitch  in  England  as 
it  did  in  Holland,  where,  there  being  no  rich  idle  class  to  set 
the  example  of  a  reckless  expenditure,  and  the  mercantile 
classes,  who  possessed  the  substantial  power  on  which  social 
influence  always  waits,  being  left  to  establish  their  own  scale 
of  living  and  standard  of  propriety,  their  habits  remained  frugal 
and  unostentatious. 

In  England  and  Holland,  then,  for  a  long  time  past,  and  now 
in  most  other  countries  in  Europe  (which  are  rapidly  following 
England  in  the  same  race),  the  desire  of  accumulation  does  not 
require,  to  make  it  effective,  the  copious  returns  which  it  re¬ 
quires  in  Asia,  but  is  sufficiently  called  into  action  by  a  rate  of 
profit  so  low,  that  instead  of  slackening,  accumulation  seems 
now  to  proceed  more  rapidly  than  ever ;  and  the  second  requisite 
of  increased  production,  increase  of  capital,  shows  no  tendency 
to  become  deficient.  So  far  as  that  element  is  concerned,  pro¬ 
duction  is  susceptible  of  an  increase  without  any  assignable 
bounds. 

The  progress  of  accumulation  would  no  doubt  be  considerably 
checked,  if  the  returns  to  capital  were  to  be  reduced  still  lower 
than  at  present.  But  why  should  any  possible  increase  of  capital 
have  that  effect?  This  question  carries  the  mind  forward  to 
the  remaining  one  of  the  three  requisites  of  production.  The 
limitation  to  production,  not  consisting  in  any  necessary  limit 
to  the  increase  of  the  other  two  elements,  labor  and  capital, 
must  turn  upon  the  properties  of  the  only  element  which  is  in¬ 
herently,  and  in  itself,  limited  in  quantity.  It  must  depend  on 
the  properties  of  land. 


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ENGRAVING. 

Fac-similes  from  Rare  and  Curious  Books. 


TITLE-PAGE  BY  HOLBEIN. 

I  his  is  a  lac  -simile  of  a  title-page  that  was  designed  for  an  edition  ol  the  New 
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T  '  ■Wi  «■  > 


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4b«gfit/aufy 
ItSung. 


LAW  OF  INCREASE  OF  PRODUCTION  FROM  LAND  173 


Chapter  XII. — Of  the  Law  of  the  Increase  of  Production  from 

Land 

§  1.  Land  differs  from  the  other  elements  of  production,  labor 
and  capital,  in  not  being  susceptible  of  indefinite  increase.  Its 
extent  is  limited,  and  the  extent  of  the  more  productive  kinds 
of  it  mbrelimfled  still.  It  is  also  evident  that  the  quantity  of 
produce  capable  of  being  raised  on  any  given  piece  of  land  is 
not  indefinite.  This  limited  quantity  of  land,  and  limited  pro¬ 
ductiveness  of  it,  are  the  real  limits  to  the  increase  of  production. 

That  they  are  the  ultimate  limits,  must  always  have  been 
clearly  seen.  But  since  the  final  barrier  has  never  in  any  in¬ 
stance  been  reached ;  since  there  is  no  country  in  which  all  the 
land,  capable  of  yielding  food,  is  so  highly  cultivated  that  a 
larger  produce  could  not  (even  without  supposing  any  fresh 
advance  in  agricultural  knowledge)  be  obtained  from  it,  and 
since  a  large  portion  of  the  earth’s  surface  still  remains  entirely 
uncultivated ;  it  is  commonly  thought,  and  is  very  natural  at 
first  to  suppose,  that  for  the  present  all  limitation  of  production 
or  population  from  this  source  is  at  an  indefinite  distance,  and 
that  ages  must  elapse  before  any  practical  necessity  arises  for 
taking  the  limiting  principle  into  serious  consideration. 

I  apprehend  this  to  be  not  only  an  error,  but  the  most  serious 
one,  to  be  found  in  the  whole  field  of  political  economy.  The 
question  is  more  important  and  fundamental  than  any  other; 
it  involves  the  whole  subject  of  the  causes  of  poverty,  in  a  rich 
and  industrious  community ;  and  unless  this  one  matter  be 
thoroughly  understood,  it  is  to  no  purpose  proceeding  any  fur¬ 
ther  in  our  inquiry. 

§  2.  The  limitation  to  production  from  the  properties  of  the 
soil,  is  not  like  the  obstacle  opposed  by  a  wall,  which  stands 
immovable  in  one  particular  spot,  and  offers  no  hindrance  to 
motion  short  of  stopping  it  entirely.  We  may  rather  compare 
it  to  a  highly  elastic  and  extensible  band,  which  is  hardly  ever 
so  violently  stretched  that  it  could  not  possibly  be  stretched  any 
more,  yet  the  pressure  of  which  is  felt  long  before  the  final  limit 
is  reached,  and  felt  more  severely  the  nearer  that  limit  is  ap¬ 
proached. 

After  a  certain,  and  not  very  advanced,  stage  in  the  progress 
of  agriculture,  it  Is  the  law  ot  production  from  the  land,  that 
in  any  given  state  of  agricultural  skill  and  knowledge,  by  in- 


i74 


POLITICAL  ECONOMY 


creasing  the  labor,  the  produce  is  not  increased  in  an  equal 
degree;  doubling  the  labor  does  not  double  the  produce;  or, 
to  express  the  same  thing  in  other  words,  every  increase  of 
produce  is  obtained  by  a  more  than  proportional  increase  in  the 
application  of  labor  to  the  land. 

This  general  law  of  agricultural  industry  is  the  most  impor¬ 
tant  proposition  in  political  economy.  Were  the  law  different, 
nearly  all  the  phenomena  of  the  production  and  distribution  of 
wealth  would  be  other  than  they  are.  The  most  fundamental 
errors  which  still  prevail  on  our  subject,  result  from  not  per¬ 
ceiving  this  law  at  work  underneath  the  more  superficial  agen¬ 
cies  on  which  attention  fixes  itself ;  but  mistaking  these  agencies 
for  the  ultimate  causes  of  effects  of  which  they  may  influence 
the  form  and  mode,  but  of  which  it  alone  determines  the  essence. 

When,  for  the  purpose  of  raising  an  increase  of  produce,  re¬ 
course  is  had  to  inferior  land,  it  is  evident  that,  so  far,  the 
produce  does  not  increase  in  the  same  proportion  with  the  labor. 
The  very  meaning  of  inferior  land,  is  land  which  with  equal 
labor  returns  a  smaller  amount  of  produce.  Land  may  be 
inferior  either  in  fertility  or  in  situation.  The  one  requires 
a  greater  proportional  amount  of  labor  for  growing  the  pro¬ 
duce,  the  other  for  carrying  it  to  market.  If  the  land  A  yields 
a  thousand  quarters  of  wheat,  to  a  given  outlay  in  wages, 
manure,  etc.,  and  in  order  to  raise  another  thousand  recourse 
must  be  had  to  the  land  B,  which  is  either  less  fertile  or  more 
distant  from  the  market,  the  two  thousand  quarters  will  cost 
more  than  twice  as  much  labor  as  the  original  thousand,  and 
the  produce  of  agriculture  will  be  increased  in  a  less  ratio  than 
the  labor  employed  in  procuring  it. 

Instead  of  cultivating  the  land  B,  it  would  be  possible,  by 
higher  cultivation,  to  make  the  land  A  produce  more.  It  might 
be  ploughed  or  harrowed  twice  instead  of  once,  or  three  times 
instead  of  twice ;  it  might  be  dug  instead  of  being  ploughed ; 
after  ploughing,  it  might  be  gone  over  with  a  hoe  instead  of 
a  harrow,  and  the  soil  more  completely  pulverized ;  it  might  be 
oftener  or  more  thoroughly  weeded ;  the  implements  used  might 
be  of  higher  finish,  or  more  elaborate  construction;  a  greater 
quantity  or  more  expensive  kinds  of  manure  might  be  applied, 
or  when  applied,  they  might  be  more  carefully  mixed  and  incor¬ 
porated  with  the  soil.  These  are  some  of  the  modes  by  which 
the  same  land  may  be  made  to  yield  a  greater  produce ;  and 


LAW  OF  INCREASE  OF  PRODUCTION  FROM  LAND  175 


when  a  greater  produce  must  be  had,  some  of  these  are  among 
the  means  usually  employed  for  obtaining  it.  But,  that  it  is 
obtained  at  a  more  than  proportional  increase  of  expense,  is  evi¬ 
dent  from  the  fact  that  inferior  lands  are  cultivated.  Inferior 
lands,  or  lands  at  a  greater  distance  from  the  market,  of  course 
yield  an  inferior  return,  and  an  increasing  demand  cannot  be 
supplied  from  them  unless  at  an  augmentation  of  cost,  and  there¬ 
fore  of  price.  If  the  additional  demand  could  continue  to  be 
supplied  from  the  superior  lands,  by  applying  additional  labor 
and  capital,  at  no  greater  proportional  cost  than  that  at  which 
they  yield  the  quantity  first  demanded  of  them,  the  owners  or 
farmers  of  those  lands  could  undersell  all  others,  and  engross 
the  whole  market.  Lands  of  a  lower  degree  of  fertility  or  in 
a  more  remote  situation,  might  indeed  be  cultivated  by  their 
proprietors,  for  the  sake  of  subsistence  or  independence ;  but  it 
never  could  be  the  interest  of  anyone  to  farm  them  for  profit. 
That  a  profit  can  be  made  from  them,  sufficient  to  attract  capital 
to  such  an  investment,  is  a  proof  that  cultivation  on  the  more 
eligible  lands  has  reached  a  point,  beyond  which  any  greater 
application  of  labor  and  capital  would  yield,  at  the  best,  no 
greater  return  than  can  be  obtained  at  the  same  expense  from 
less  fertile  or  less  favorably  situated  lands. 

The  careful  cultivation  of  a  well-farmed  district  of  England 
or  Scotland  is  a  symptom  and  an  effect  of  the  more  unfavorable 
terms  which  the  land  has  begun  to  exact  for  any  increase  of  its 
fruits.  Such  elaborate  cultivation  costs  much  more  in  propor¬ 
tion,  and  requires  a  higher  price  to  render  it  profitable,  than 
farming  on  a  more  superficial  system;  and  would  not  be 
adopted  if  access  could  be  had  to  land  of  equal  fertility,  pre¬ 
viously  unoccupied.  Where  there  is  the  choice  of  raising  the 
increasing  supply  which  society  requires,  from  fresh  land  of 
as  good  quality  as  that  already  cultivated,  no  attempt  is  made 
to  extract  from  land  anything  approaching  to  what  it  will  yield 
on  what  are  esteemed  the  best  European  modes  of  cultivating. 
The  land  is  tasked  up  to  the  point  at  which  the  greatest  return 
is  obtained  in  proportion  to  the  labor  employed,  but  no  further : 
any  additional  labor  is  carried  elsewhere.  “  It  is  long,”  says  an 
intelligent  traveller  in  the  United  States,*  “  before  an  English 
eye  becomes  reconciled  to  the  lightness  of  the  crops  and  the 

*  “  Letters  from  America,”  by  John  “  Lyell’s  Travels  in  America,”  vol.  ii. 
Robert  Godley,  vol.  i.  p.  42.  See  also  p.  83. 


176 


POLITICAL  ECONOMY 


careless  farming  (as  we  should  call  it)  which  is  apparent.  One 
forgets  that  where  land  is  so  plentiful  and  labor  so  dear  as  it 
is  here,  a  totally  different  principle  must  be  pursued  to  that 
which  prevails  in  populous  countries,  and  that  the  consequences 
will  of  course  be  a  want  of  tidiness,  as  it  were,  and  finish,  about 
everything  which  requires  labor/’  Of  the  two  causes  mentioned, 
the  plentifulness  of  land  seems  to  me  the  true  explanation,  rather 
than  the  dearness  of  labor;  for,  however  dear  labor  may  be, 
when  food  is  wanted,  labor  will  always  be  applied  to  producing 
it  in  preference  to  anything  else.  But  this  labor  is  more  effec¬ 
tive  for  its  end  by  being  applied  to  fresh  soil,  than  if  it  were 
employed  in  bringing  the  soil  already  occupied  into  higher  cul¬ 
tivation.  Only  when  no  soils  remain  to  be  broken  up  but  such 
as  either  from  distance  or  inferior  quality  require  a  consider¬ 
able  rise  of  price  to  render  their  cultivation  profitable,  can  it 
become  advantageous  to  apply  the  high  farming  of  Europe  to 
any  American  lands ;  except,  perhaps,  in  the  immediate  vicinity 
of  towns,  where  saving  in  cost  of  carriage  may  compensate  for 
great  inferiority  in  the  return  from  the  soil  itself.  As  American 
farming  is  to  English,  so  is  the  ordinary  English  to  that  of 
Flanders,  Tuscany,  or  the  Terra  di  Lavoro;  where  by  the 
application  of  a  far  greater  quantity  of  labor  there  is  obtained 
a  considerably  larger  gross  produce,  but  on  such  terms  as  would 
never  be  advantageous  to  a  mere  speculator  for  profit,  unless 
made  so  by  much  higher  prices  of  agricultural  produce. 

The  principle  which  has  now  been  stated  must  be  received, 
no  doubt,  with  certain  explanations  and  limitations.  Even  after 
the  land  is  so  highly  cultivated  that  the  mere  application  of 
additional  labor,  or  of  an  additional  amount  of  ordinary  dress¬ 
ing,  would  yield  no  return  proportioned  to  the  expense,  it  may 
still  happen  that  the  application  of  a  much  greater  additional 
labor  and  capital  to  improving  the  soil  itself,  by  draining  or 
permanent  manures,  would  be  as  liberally  remunerated  by  the 
produce,  as  any  portion  of  the  labor  and  capital  already  em¬ 
ployed.  It  would  sometimes  be  much  more  amply  remunerated. 
This  could  not  be,  if  capital  always  sought  and  found  the  most 
advantageous  employment;  but  if  the  most  advantageous  em¬ 
ployment  has  to  wait  longest  for  its  remuneration,  it  is  only 
in  a  rather  advanced  stage  of  industrial  development  that  the 
preference  will  be  given  to  it ;  and  even  in  that  advanced  stage, 
the  laws  or  usages  connected  with  property  in  land  and  the 


LAW  OF  INCREASE  OF  PRODUCTION  FROM  LAND  177 


tenure  of  farms,  are  often  such  as  to  prevent  the  disposable 
capital  of  the  country  from  flowing  freely  into  the  channel  of 
agricultural  improvement :  and  hence  the  increased  supply,  re¬ 
quired  by  increasing  population,  is  sometimes  raised  at  an  aug¬ 
menting  cost  by  higher  cultivation,  when  the  means  of  produc¬ 
ing  it  without  increase  of  cost  are  known  and  accessible.  There 
can  be  no  doubt,  that  if  capital  were  forthcoming  to  execute, 
within  the  next  year,  all  known  and  recognized  improvements 
in  the  land  of  the  United  Kingdom  which  would  pay  at  the 
existing  prices,  that  is,  which  would  increase  the  produce  in 
as  great  or  a  greater  ratio  than  the  expense ;  the  result  would 
be  such  (especially  if  we  include  Ireland  in  the  supposition) 
that  inferior  land  would  not  for  a  long  time  require  to  be 
brought  under  tillage :  probably  a  considerable  part  of  the  less 
productive  lands  now  cultivated,  which  are  not  particularly 
favored  by  situation,  would  go  out  of  culture;  or  (as  the  im¬ 
provements  in  question  are  not  so  much  applicable  to  good 
land,  but  operate  rather  by  converting  bad  land  into  good)  the 
contraction  of  cultivation  might  principally  take  place  by  a  less 
high  dressing  and  less  elaborate  tilling  of  land  generally;  a 
falling  back  to  something  nearer  the  character  of  American 
farming;  such  only  of  the  poor  lands  being  altogether  aban¬ 
doned  as  were  not  found  susceptible  of  improvement.  And 
thus  the  aggregate  produce  of  the  whole  cultivated  land  would 
bear  a  larger  proportion  than  before  to  the  labor  expended 
on  it;  and  the  general  law  of  diminishing  return  from  land 
would  have  undergone,  to  that  extent,  a  temporary  superses¬ 
sion.  No  one,  however,  can  suppose  that  even  in  these  circum¬ 
stances,  the  whole  produce  required  for  the  country  could  be 
raised  exclusively  from  the  best  lands,  together  with  those  pos¬ 
sessing  advantages  of  situation  to  place  them  on  a  par  with  the 
best.  Much  would  undoubtedly  continue  to  be  produced  under 
less  advantageous  conditions,  and  with  a  smaller  proportional 
return,  than  that  obtained  from  the  best  soils  and  situations. 
And  in  proportion  as  the  further  increase  of  population  re¬ 
quired  a  still  greater  addition  to  the  supply,  the  general  law 
would  resume  its  course,  and  the  further  augmentation  would 
be  obtained  at  a  more  than  proportionate  expense  of  labor  and 
capital. 

§  3.  That  the  produce  of  land  increases,  cateris  paribus,  in 
a  diminishing  ratio  to  the  increase  in  the  labor  employed,  is  a 

VOL.  I.— 12 


178 


POLITICAL  ECONOMY 


truth  more  often  ignored  or  disregarded  than  actually  denied. 
It  has,  however,  met  with  a  direct  impugner  in  the  well-known 
American  political  economist,  Mr.  H.  C.  Carey,  who  maintains, 
that  the  real  law  of  agricultural  industry  is  the  very  reverse; 
the  produce  increasing  in  a  greater  ratio  than  the  labor,  or  in 
other  words,  affording  to  labor  a  perpetually  increasing  return. 
To  substantiate  this  assertion,  he  argues,  that  cultivation  does 
not  begin  with  the  better  soils,  and  extend  from  them,  as  the 
demand  increases,  to  the  poorer,  but  begins  with  the  poorer, 
and  does  not,  till  long  after,  extend  itself  to  the  more  fertile. 
Settlers  in  a  new  country  invariably  commence  on  the  high  and 
thin  lands ;  the  rich  but  swampy  soils  of  the  river  bottoms 
cannot  at  first  be  brought  into  cultivation,  by  reason  of  their 
unhealthiness,  and  of  the  great  and  prolonged  labor  required 
for  clearing  and  draining  them.  As  population  and  wealth 
increase,  cultivation  travels  down  the  hillsides,  clearing  them 
as  it  goes,  and  the  most  fertile  soils,  those  of  the  low  grounds, 
are  generally  (he  even  says  universally)  the  latest  cultivated. 
These  propositions,  with  the  inferences  which  Mr.  Carey  draws 
from  them,  are  set  forth  at  much  length  in  his  latest  and  most 
elaborate  treatise,  “  Principles  of  Social  Science  ” ;  and  he 
considers  them  as  subverting  the  very  foundation  of  what  he 
calls  the  English  political  economy,  with  all  its  practical  con¬ 
sequences,  especially  the  doctrine  of  free  trade. 

As  far  as  words  go,  Mr.  Carey  has  a  good  case  against  several 
of  the  highest  authorities  in  political  economy,  who  certainly 
did  enunciate  in  too  universal  a  manner  the  law  which  they 
laid  down,  not  remarking  that  it  is  not  true  of  the  first  cultiva- 
tion  in  a  newly  settled  country.  Where  population  is  thin  and 
capital  scanty,  land  which  requires  a  large  outlay  to  render  it 
fit  for  tillage  must  remain  untilled ;  though  such  lands,  when 
their  time  has  come,  often  yield  a  greater  produce  than  those 
earlier  cultivated,  not  only  absolutely,  but  proportionally  to 
the  labor  employed,  even  if  we  include  that  which  had  been 
expended  in  originally  fitting  them  for  culture.  But  it  is  not 
pretended  that  the  law  of  diminishing  return  was  operative 
from  the  very  beginning  of  society ;  and  though  some  political 
economists  may  have  believed  it  to  come  into  operation  earlier 
than  it  does,  it  begins  quite  early  enough  to  support  the  con¬ 
clusions  they  founded  on  it.  Mr.  Carey  will  hardly  assert  that 
in  any  old  country — in  England  and  France,  for  example — 


LAW  OF  INCREASE  OF  PRODUCTION  FROM  LAND  179 


the  lands  left  waste  are,  or  have  for  centuries  been,  more  nat¬ 
urally  fertile  than  those  under  tillage.  Judging  even  by  his 
own  imperfect  test,  that  of  local  situation — how  imperfect,  I 
need  not  stop  to  point  out — is  it  true  that  in  England  or  France 
at  the  present  day,  the  uncultivated  part  of  the  soil  consists 
of  the  plains  and  valleys,  and  the  cultivated  of  the  hills  ?  Every¬ 
one  knows,  on  the  contrary,  that  it  is  the  high  lands  and  thin 
soils  which  are  left  to  nature ;  and  when  the  progress  of  pop¬ 
ulation  demands  an  increase  of  cultivation,  the  extension  is  from 
the  plains  to  the  hills.  Once  in  a  century,  perhaps,  a  Bedford 
Level  may  be  drained,  or  a  Lake  of  Harlem  pumped  out ;  but 
these  are  slight  and  transient  exceptions  to  the  normal  progress 
of  things;  and  in  old  countries  which  are  at  all  advanced  in 
civilization,  little  of  this  sort  remains  to  be  done.* 

Mr.  Carey  himself  unconsciously  bears  the  strongest  testi¬ 
mony  to  the  reality  of  the  law  he  contends  against;  for  one 
of  the  propositions  most  strenuously  maintained  by  him  is, 
that  the  raw  products  of  the  soil,  in  an  advancing  community, 
steadily  tend  to  rise  in  price.  Now,  the  most  elementary  truths 
of  political  economy  show  that  this  could  not  happen,  unless 
the  cost  of  production,  measured  in  labor,  of  those  products, 
tended  to  rise.  If  the  application  of  additional  labor  to  the  land 
was,  as  a  general  rule,  attended  with  an  increase  in  the  propor¬ 
tional  return,  the  price  of  produce,  instead  of  rising,  must 
necessarily  fall  as  society  advances,  unless  the  cost  of  production 
of  gold  and  silver  fell  still  more :  a  case  so  rare,  that  there  are 
only  two  periods  in  all  history  when  it  is  known  to  have  taken 
place :  the  one,  that  which  followed  the  opening  of  the  Mexican 
and  Peruvian  mines ;  the  other,  that  in  which  we  now  live. 
At  all  known  periods  except  these  two,  the  cost  of  production 
of  the  precious  metals  has  been  either  stationary  or  rising.  If, 
therefore,  it  be  true  that  the  tendency  of  agricultural  produce 
is  to  rise  in  money  price  as  wealth  and  population  increase, 
there  needs  no  other  evidence  that  the  labor  required  for  raising 
it  from  the  soil  tends  to  augment  when  a  greater  quantity  is 
demanded. 

I  do  not  go  so  far  as  Mr.  Carey:  I  do  not  assert  that  the 


*  Ireland  may  be  alleged  as  an  excep¬ 
tion,  a  large  fraction  of  the  entire  soil 
of  that  country  being  still  incapable  of 
cultivation  for  want  of  drainage.  But, 
though  Ireland  is  an  old  country,  un¬ 
fortunate  social  and  political  circum¬ 
stances  have  kept  it  a  poor  and  back¬ 


ward  one.  Neither  is  it  at  all  certain 
that  the  bogs  of  Ireland,  if  drained  and 
brought  under  tillage,  would  take  their 
place  along  with  Mr.  Carey’s  fertile  river 
bottoms,  or  among  any  but  the  poorer 
soils. 


i8o 


POLITICAL  ECONOMY 


cost  of  production  and  consequently  the  price,  of  agricultural 
produce,  always  and  necessarily  rises  as  population  increases. 
It  tends  to  do  so,  but  the  tendency  may  be,  and  sometimes  is, 
even  during  long  periods,  held  in  check.  The  effect  does  not 
depend  on  a  single  principle,  but  on  two  antagonizing  prin¬ 
ciples.  There  is  another  agency,  in  habitual  antagonism  to  the 
law  of  diminishing  return  from  land ;  and  to  the  consideration 
of  this  we  shall  now  proceed.  It  is  no  other  than  the  progress 
of  civilization.  I  use  this  general  and  somewhat  vague  ex¬ 
pression,  because  the  things  to  be  included  are  so  various,  that 
hardly  any  term  of  a  more  restricted  signification  would  com¬ 
prehend  them  all. 

Of  these,  the  most  obvious  is  the  progress  of  agricultural 
knowledge,  skill,  and  invention.  Improved  processes  of  agri¬ 
culture  are  of  two  kinds :  some  enable  the  land  to  yield  a  greater 
absolute  produce,  without  an  equivalent  increase  of  labor ;  oth¬ 
ers  have  not  the  power  of  increasing  the  produce,  but  have  that 
of  diminishing  the  labor  and  expense  by  which  it  is  obtained. 
Among  the  first  are  to  be  reckoned  the  disuse  of  fallows,  by 
means  of  the  rotation  of  crops ;  and  the  introduction  of  new 
articles  of  cultivation  capable  of  entering  advantageously  into 
the  rotation.  The  change  made  in  British  agriculture  toward 
the  close  of  the  last  century,  by  the  introduction  of  turnip  hus¬ 
bandry,  is  spoken  of  as  amounting  to  a  revolution.  These  im¬ 
provements  operate  not  only  by  enabling  the  land  to  produce 
a  crop  every  year  instead  of  remaining  idle  one  year  in  every 
two  or  three  to  renovate  its  powers,  but  also  by  direct  increase 
of  its  productiveness ;  since  the  great  addition  made  to  the  num¬ 
ber  of  cattle  by  the  increase  of  their  food,  affords  more  abun¬ 
dant  manure  to  fertilize  the  corn  lands.  Next  in  order  comes 
the  introduction  of  new  articles  of  food  containing  a  greater 
amount  of  sustenance,  like  the  potato,  or  more  productive  spe¬ 
cies  or  varieties  of  the  same  plant,  such  as  the  Swedish  turnip. 
In  the  same  class  of  improvements  must  be  placed  a  better 
knowledge  of  the  properties  of  manures,  and  of  the  most  effec¬ 
tual  modes  of  applying  them ;  the  introduction  of  new  and 
more  powerful  fertilizing  agents,  such  as  guano,  and  the  con¬ 
version  to  the  same  purpose,  of  substances  previously  wasted ; 
inventions  like  subsoil-ploughing  or  tile-draining;  improve¬ 
ments  in  the  breed  or  feeding  of  laboring  cattle;  augmented 
stock  of  the  animals  which  consume  and  convert  into  human 


LAW  OF  INCREASE  OF  PRODUCTION  FROM  LAND  181 


food  what  would  otherwise  be  wasted ;  and  the  like.  The  other 
sort  of  improvements,  those  which  diminish  labor,  but  without 
increasing  the  capacity  of  the  land  to  produce,  are  such  as  the 
improved  construction  of  tools;  the  introduction  of  new  in¬ 
struments  which  spare  manual  labor,  as  the  winnowing  and 
threshing  machines ;  a  more  skilful  and  economical  application 
of  muscular  exertion,  such  as  the  introduction,  so  slowly  ac¬ 
complished  in  England,  of  Scotch  ploughing,  with  two  horses 
abreast  and  one  man,  instead  of  three  cr  four  horses  in  a  team 
and  two  men,  etc.  These  improvements  do  not  add  to  the  pro¬ 
ductiveness  of  the  land,  but  they  are  equally  calculated  with 
the  former  to  counteract  the  tendency  in  the  cost  of  production 
of  agricultural  produce,  to  rise  with  the  progress  of  population 
and  demand. 

Analogous  in  effect  to  this  second  class  of  agricultural  im¬ 
provements,  are  improved  means  of  communication.  Good 
roads  are  equivalent  to  good  tools.  It  is  of  no  consequence 
whether  the  economy  of  labor  takes  place  in  extracting  the  pro¬ 
duce  from  the  soil,  or  in  conveying  it  to  the  place  where  it  is 
to  be  consumed.  Not  to  say  in  addition,  that  the  labor  of  cul¬ 
tivation  itself  is  diminished  by  whatever  lessens  the  cost  of 
bringing  manure  from  a  distance,  or  facilitates  the  many  opera¬ 
tions  of  transport  from  place  to  place  which  occur  within  the 
bounds  of  the  farm.  Railways  and  canals  are  virtually  a  dimi¬ 
nution  of  the  cost  of  production  of  all  things  sent  to  market  by 
them ;  and  literally  so  of  all  those,  the  appliances  and  aids  for 
producing  which,  they  serve  to  transmit.  By  their  means  land 
can  be  cultivated,  which  would  not  otherwise  have  remuner¬ 
ated  the  cultivators  without  a  rise  of  price.  Improvements  in 
navigation  have,  with  respect  to  food  or  materials  brought  from 
beyond  sea,  a  corresponding  effect. 

From  similar  considerations,  it  appears  that  many  purely 
mechanical  improvements,  which  have,  apparently  at  least,  no 
peculiar  connection  with  agriculture,  nevertheless  enable  a  given 
amount  of  food  to  be  obtained  with  a  smaller  expenditure  of 
labor.  A  great  improvement  in  the  process  of  melting  iron, 
would  tend  to  cheapen  agricultural  implements,  diminish  the 
cost  of  railroads,  of  wagons  and  carts,  ships,  and  perhaps  build¬ 
ings,  and  many  other  things  to  which  iron  is  not  at  present 
applied,  because  it  is  too  costly;  and  would  thence  diminish 
the  cost  of  production  of  food.  The  same  effect  would  follow 


182 


POLITICAL  ECONOMY 


from  an  improvement  in  those  processes  of  what  may  be  termed 
manufacture,  to  which  the  material  of  food  is  subjected  after 
it  is  separated  from  the  ground.  The  first  application  of  wind 
or  water  power  to  grind  corn,  tended  to  cheapen  bread  as  much 
as  a  very  important  discovery  in  agriculture  would  have  done ; 
and  any  great  improvement  in  the  construction  of  corn-mills, 
would  have,  in  proportion,  a  similar  influence.  The  effects  of 
cheapening  locomotion  have  been  already  considered.  There  are 
also  engineering  inventions  which  facilitate  all  great  operations 
on  the  earth’s  surface.  An  improvement  in  the  art  of  taking 
levels  is  of  importance  to  draining,  not  to  mention  canal  and 
railway  making.  The  fens  of  Holland,  and  of  some  parts  of 
England,  are  drained  by  pumps  worked  by  the  wind  or  by  steam. 
Where  canals  of  irrigation,  or  where  tanks  or  embankments  are 
necessary,  mechanical  skill  is  a  great  resource  for  cheapening 
production. 

Those  manufacturing  improvements  which  cannot  be  made 
instrumental  to  facilitate,  in  any  of  its  stages,  the  actual  pro¬ 
duction  of  food,  and  therefore  do  not  help  to  counteract  or 
retard  the  diminution  of  the  proportional  return  to  labor  from 
the  soil,  have,  however,  another  effect,  which  is  practically 
equivalent.  What  they  do  not  prevent,  they  yet,  in  some  degree, 
compensate  for. 

The  materials  of  manufactures  being  all  drawn  from  the  land, 
and  many  of  them  from  agriculture,  which  supplies  in  particu¬ 
lar  the  entire  material  of  clothing;  the  general  law  of  produc¬ 
tion  from  the  land,  the  law  of  diminishing  return,  must  in  the 
last  resort  be  applicable  to  manufacturing  as  well  as  to  agri¬ 
cultural  industry.  As  population  increases,  and  the  power  of 
the  land  to  yield  increased  produce  is  strained  harder  and 
harder,  any  additional  supply  of  material,  as  well  as  of  food, 
must  be  obtained  by  a  more  than  proportionally  increasing  ex¬ 
penditure  of  labor.  But  the  cost  of  the  material  forming  gen¬ 
erally  a  very  small  portion  of  the  entire  cost  of  the  manufacture, 
the  agricultural  labor  concerned  in  the  production  of  manu¬ 
factured  goods  is  but  a  small  fraction  of  the  whole  labor  worked 
up  in  the  commodity.  All  the  rest  of  the  labor  tends  con¬ 
stantly  and  strongly  toward  diminution,  as  the  amount  of  pro¬ 
duction  increases.  Manufactures  are  vastly  more  susceptible 
than  agriculture,  of  mechanical  improvements,  and  contrivances 
for  saving  labor ;  and  it  has  already  been  seen  how  greatly  the 


LAW  OF  INCREASE  OF  PRODUCTION  FROM  LAND  183 


division  of  labor,  and  its  skilful  and  economical  distribution, 
depend  on  the  extent  of  the  market,  and  on  the  possibility  of 
production  in  large  masses.  In  manufactures,  accordingly,  the 
causes  tending  to  increase  the  productiveness  of  industry,  pre¬ 
ponderate  greatly  over  the  one  cause  which  tends  to  diminish  it : 
and  the  increase  of  production,  called  forth  by  the  progress  of 
society,  takes  place,  not  at  an  increasing,  but  at  a  continually 
diminishing  proportional  cost.  This  fact  has  manifested  itself 
in  the  progressive  fall  of  the  prices  and  values  of  almost  every 
kind  of  manufactured  goods  during  two  centuries  past ;  a  fall 
accelerated  by  the  mechanical  inventions  of  the  last  seventy  or 
eighty  years,  and  susceptible  of  being  prolonged  and  extended 
beyond  any  limit  which  it  would  be  safe  to  specify. 

Now  it  is  quite  conceivable  that  the  efficiency  of  agricultural 
labor  might  be  undergoing,  with  the  increase  of  produce,  a 
gradual  diminution;  that  the  price  of  food,  in  consequence, 
might  be  progressively  rising,  and  an  ever  growing  proportion 
of  the  population  might  be  needed  to  raise  food  for  the  whole ; 
while  yet  the  productive  power  of  labor  in  all  other  branches 
of  industry  might  be  so  rapidly  augmented,  that  the  required 
amount  of  labor  could  be  spared  from  manufactures,  and  never¬ 
theless  a  greater  produce  be  obtained,  and  the  aggregate  wants 
of  the  community  be  on  the  whole  better  supplied,  than  before. 
The  benefit  might  even  extend  to  the  poorest  class.  The  in¬ 
creased  cheapness  of  clothing  and  lodging  might  make  up  to 
them  for  the  augmented  cost  of  their  food. 

There  is,  thus,  no  possible  improvement  in  the  arts  of  pro¬ 
duction  which  does  not  in  one  or  another  mode  exercise  an 
antagonistic  influence  to  the  law  of  diminishing  return  to  agri¬ 
cultural  labor.  Nor  is  it  only  industrial  improvements  which 
have  this  effect.  Improvements  in  government,  and  almost 
every  kind  of  moral  and  social  advancement,  operate  in  the 
same  manner.  Suppose  a  country  in  the  condition  of  France 
before  the  Revolution:  taxation  imposed  almost  exclusively 
on  the  industrious  classes,  and  on  such  a  principle  as’ to  be  an 
actual  penalty  on  production;  and  no  redress  obtainable  for 
any  injury  to  property  or  person,  when  inflicted  by  people  of 
rank  or  court  influence.  Was  not  the  hurricane  which  swept 
away  this  system  of  things,  even  if  we  look  no  further  than  to 
its  effect  in  augmenting  the  productiveness  of  labor,  equivalent 
to  many  industrial  inventions  ?  The  removal  of  a  fiscal  burthen 


184 


POLITICAL  ECONOMY 


on  agriculture,  such  as  tithe,  has  the  same  effect  as  if  the  labor 
necessary  for  obtaining  the  existing  produce  were  suddenly 
reduced  one-tenth.  The  abolition  of  corn  laws,  or  of  any  other 
restrictions  which  prevent  commodities  from  being  produced 
where  the  cost  of  their  production  is  lowest,  amounts  to  a  vast 
improvement  in  production.  When  fertile  land,  previously  re¬ 
served  as  hunting  ground,  or  for  any  other  purpose  of  amuse¬ 
ment,  is  set  free  for  culture,  the  aggregate  productiveness  of 
agricultural  industry  is  increased.  It  is  well  known  what  has 
been  the  effect  in  England  of  badly  administered  poor  laws, 
and  the  still  worse  effect  in  Ireland  of  a  bad  system  of  tenancy, 
in  rendering  agricultural  labor  slack  and  ineffective.  No  im¬ 
provements  operate  more  directly  upon  the  productiveness  of 
labor  than  those  in  the  tenure  of  farms,  and  in  the  laws  relating 
to  landed  property.  The  breaking  up  of  entails,  the  cheapening 
of  the  transfer  of  property,  and  whatever  else  promotes  the 
natural  tendency  of  land  in  a  system  of  freedom,  to  pass  out  of 
hands  which  can  make  little  of  it  into  those  which  can  make 
more ;  the  substitution  of  long  leases  for  tenancy  at  will,  and 
of  any  tolerable  system  of  tenancy  whatever  for  the  wretched 
cottier  system ;  above  all,  the  acquisition  of  a  permanent  in¬ 
terest  in  the  soil  by  the  cultivators  of  it;  all  these  things  are 
as  real,  and  some  of  them  as  great,  improvements  in  production, 
as  the  invention  of  the  spinning  jenny  or  the  steam  engine. 

We  may  say  the  same  of  improvement  in  education.  The 
intelligence  of  the  workman  is  a  most  important  element  in 
the  productiveness  of  labor.  So  low,  in  some  of  the  most 
civilized  countries,  is  the  present  standard  of  intelligence,  that 
there  is  hardly  any  source  from  which  a  more  indefinite  amount 
of  improvement  may  be  looked  for  in  productive  power, 
than  by  endowing  with  brains  those  who  now  have  only 
hands.  The  carefulness,  economy,  and  general  trustworthi¬ 
ness  of  laborers  are  as  important  as  their  intelligence.  Friend¬ 
ly  relations,  and  a  community  of  interest  and  feeling  be¬ 
tween  laborers  and  employers,  are  eminently  so:  I  should 
rather  say,  would  be;  for  I  know  not  where  any  such  sen¬ 
timent  of  friendly  alliance  now  exists.  Nor  is  it  only  in  the 
laboring  class  that  improvement  of  mind  and  character  operates 
with  beneficial  effect  even  on  industry.  In  the  rich  and  idle 
classes,  increased  mental  energy,  more  solid  instruction,  and 
stronger  feelings  of  conscience,  public  spirit,  or  philanthropy, 


LAW  OF  INCREASE  OF  PRODUCTION  FROM  LAND  185 

would  qualify  them  to  originate  and  promote  the  most  valuable 
improvements,  both  in  the  economical  resources  of  their  coun¬ 
try,  and  in  its  institutions  and  customs.  To  look  no  further 
than  the  most  obvious  phenomena ;  the  backwardness  of  French 
agriculture  in  the  precise  points  in  which  benefit  might  be  ex¬ 
pected  from  the  influence  of  an  educated  class,  is  partly  ac¬ 
counted  for  by  the  exclusive  devotion  of  the  richer  landed  pro¬ 
prietors  to  town  interests  and  town  pleasures.  There  is  scarcely 
any  possible  amelioration  of  human  affairs  which  would  not, 
among  its  other  benefits,  have  a  favorable  operation,  direct  or 
indirect,  upon  the  productiveness  of  industry.  The  intensity 
of  devotion  to  industrial  occupations  would  indeed  in  many 
cases  be  moderated  by  a  more  liberal  and  genial  mental  culture, 
but  the  labor  actually  bestowed  on  those  occupations  would 
almost  always  be  rendered  more  effective. 

Before  pointing  out  the  principal  inferences  to  be  drawn  from 
the  nature  of  the  two  antagonistic  forces  by  which  the  produc¬ 
tiveness  of  agricultural  industry  is  determined,  we  must  observe 
that  what  we  have  said  of  agriculture  is  true,  with  little  varia¬ 
tion,  of  the  other  occupations  which  it  represents ;  of  all  the 
arts  which  extract  materials  from  the  globe.  Mining  industry, 
for  example,  usually  yields  an  increase  of  produce  at  a  more 
than  proportional  increase  of  expense.  It  does  worse,  for  even 
its  customary  annual  produce  requires  to  be  extracted  by  a 
greater  and  greater  expenditure  of  labor  and  capital.  As  a 
mine  does  not  reproduce  the  coal  or  ore  taken  from  it,  not  only 
are  all  mines  at  last  exhausted,  but  even  when  they  as  yet  show 
no  signs  of  exhaustion,  they  must  be  worked  at  a  continually 
increasing  cost;  shafts  must  be  sunk  deeper,  galleries  driven 
farther,  greater  power  applied  to  keep  them  clear  of  water ;  the 
produce  must  be  lifted  from  a  greater  depth,  or  conveyed  a 
greater  distance.  The  law  of  diminishing  return  applies  there¬ 
fore  to  mining,  in  a  still  more  unqualified  sense  than  to  agri¬ 
culture  :  but  the  antagonizing  agency,  that  of  improvements  in 
production,  also  applies  in  a  still  greater  degree.  Mining  opera¬ 
tions  are  more  susceptible  of  mechanical  improvements  than 
agricultural :  the  first  great  application  of  the  steam  engine 
was  to  mining ;  and  there  are  unlimited  possibilities  of  improve¬ 
ment  in  the  chemical  processes  by  which  the  metals  are  ex¬ 
tracted.  There  is  another  contingency,  of  no  unfrequent  oc¬ 
currence,  which  avails  to  counterbalance  the  progress  of  all  ex- 


1 86 


POLITICAL  ECONOMY 


isting  mines  toward  exhaustion:  this  is,  the  discovery  of  new 
ones,  equal  or  superior  in  richness. 

To  resume ;  all  natural  agents  which  are  limited  in  quantity, 
are  not  only  limited  in  their  ultimate  productive  power,  but, 
long  before  that  power  is  stretched  to  the  utmost,  they  yield 
to  any  additional  demands  on  progressively  harder  terms.  This 
law  may  however  be  suspended,  or  temporarily  controlled,  by 
whatever  adds  to  the  general  power  of  mankind  over  nature; 
and  especially  by  any  extension  of  their  knowledge,  and  their 
consequent  command,  of  the  properties  and  powers  of  natural 
agents. 

Chapter  XIII. — Consequences  of  the  Foregoing  Laws 

§  i.  From  the  preceding  exposition  it  appears  that  the  limit 
to  the  increase  of  production  is  twofold;  from  deficiency  of 
capital,  or  of  land.  Production  comes  to  a  pause,  either  because 
the  effective  desire  of  accumulation  is  not  sufficient  to  give 
rise  to  any  further  increase  of  capital,  or  because,  however  dis¬ 
posed  the  possessors  of  surplus  income  may  be  to  save  a  por¬ 
tion  of  it,  the  limited  land  at  the  disposal  of  the  community 
does  not  permit  additional  capital  to  be  employed  with  such 
a  return,  as  would  be  an  equivalent  to  them  for  their  absti¬ 
nence. 

In  countries  where  the  principle  of  accumulation  is  as  weak 
as  it  is  in  the  various  nations  of  Asia;  where  people  will  neither 
save,  nor  work  to  obtain  the  means  of  saving,  unless  under 
the  inducement  of  enormously  high  profits,  nor  even  then  if  it 
is  necessary  to  wait  a  considerable  time  for  them;  where  either 
productions  remain  scanty,  or  drudgery  great,  because  there  is 
neither  capital  forthcoming  nor  forethought  sufficient  for  the 
adoption  of  the  contrivances  by  which  natural  agents  are  made 
to  do  the  work  of  human  labor;  the  desideratum  for  such  a 
country,  economically  considered,  is  an  increase  of  industry,  and 
of  the  effective  desire  of  accumulation.  The  means  are,  first, 
a  better  government;  more  complete  security  of  property ;  mod¬ 
erate  taxes,  and  freedom  from  arbitrary  exaction  under  the 
name  of  taxes;  a  more  permanent  and  more  advantageous  ten¬ 
ure  of  land,  securing  to  the  cultivator  as  far  as  possible  the 
undivided  benefits  of  the  industry,  skill,  and  economy  he  may 
exert.  Secondly,  improvement  of  the  public  intelligence;  the 


CONSEQUENCES  OF  THE  FOREGOING  LAWS  187 


decay  of  usages  or  superstitions  which  interfere  with  the  ef¬ 
fective  employment  of  industry;  and  the  growth  of  mental  ac¬ 
tivity,  making  the  people  alive  to  new  objects  of  desire.  Thirdly, 
the  introduction  of  foreign  arts,  which  raise  the  returns  deriv¬ 
able  from  additional  capital,  to  a  rate  corresponding  to  the  low 
strength  of  the  desire  of  accumulation;  and  the  importation  of 
foreign  capital,  which  renders  the  increase  of  production  no 
longer  exclusively  dependent  on  the  thrift  or  providence  of  the 
inhabitants  themselves,  while  it  places  before  them  a  stimulat¬ 
ing  example,  and  by  instilling  new  ideas  and  breaking  the  chains 
of  habit,  if  not  by  improving  the  actual  condition  of  the  popula- 
ton,  tends  to  create  in  them  new  wants,  increased  ambition,  and 
greater  thought  for  the  future.  These  considerations  apply 
more  or  less  to  all  the  Asiatic  populations,  and  to  the  less  civil¬ 
ized  and  industrious  part  of  Europe,  as  Russia,  Turkey,  Spain, 
and  Ireland. 

§  2.  But  there  are  other  countries,  an^LEngland  is  at  the  head 
of  them,  in  which  neither  the  spirit  of  industry  nor  the  effective 
desire  of  accumulation  need  any  encouragement;  where  the 
people  will  toil  hard  for  a  small  remuneration,  and  save  much 
for  a  small  profit;  where,  though  the  general  thriftiness  of  the 
laboring  class  is  much  below  what  is  desirable, 


ac- 


"cumulation  in  the  more  prosperous  part  of  the  community  re¬ 
quires  abatement  rather  than  increase.  In  these  countries  there 
would  never  be  any  deficiency  of  capital,  if  its  increase  were 
n ever  checked  or  brought  to  a  stand  by  too  great  a  diminution 
ofTts  returns.  It  is  the  tendency  of  the  returns  to  a  progressive 
diminution/whlch  causes  the  increase  of  production  to  be  often 
attended  with  a  deterioration  in  the  condition  of  the  producers; 
and  this  tendency,  which  would  in  time  put  an  end  to  increase 
of  production  altogether,  is  a  result  of  the  necessary  and  inherent 
conditions  of  production  from  the  land. 

In  all  countries  which  have  passed  beyond  a  rather  early  stage 
in  the  progress  of  agriculture,  every  increase  in  the  demand  for 
food,  occasioned  by  increased  population,  will  always,  unless 
there  is  a  simultaneous  improvement  in  production,  diminish 
the  share  which  on  a  fair  division  would  fall  to  each  individual. 
An  increased  production,  in  default  of  unoccupied  tracts  of  fer¬ 
tile  land,  or  of  fresh  improvements  tending  to  cheapen  com¬ 
modities,  can  never  be  obtained  but  by  increasing  the  labor  in 
more  than  the  same  proportion.  The  population  must  either 


i88 


POLITICAL  ECONOMY 


work  harder,  or  eat  less,  or  obtain  their  usual  food  by  sacrific¬ 
ing  a  part  of  their  other  customary  comforts.  Whenever  this 
necessity  is  postponed,  notwithstanding  an  increase  of  popula¬ 
tion,  it  is  because  the  improvements  which  facilitate  production 
continue  progressive;  because  the  contrivances  of  mankind  for 
making  their  labor  more  effective,  keep  up  an  equal  struggle 
with  nature,  and  extort  fresh  resources  from  her  reluctant 
powers  as  fast  as  human  necessities  occupy  and  engross  the  old. 

From  this,  results  the  important  corollary,  that  the  necessity 
of  restraining  population  is  not,  as  many  persons  believe,  pecu¬ 
liar  to  a  condition  of  great  inequality  of  property.  A  greater 
number  of  people  cannot,  in  any  given  state  of  civilization,  be 
collectively  so  well  provided  for  as  a  smaller.  The  niggardli¬ 
ness  of  nature,  not  the  injustice  of  society,  is  the  cause  of  the 
penalty  attached  to  over-population.  An  unjust  distribution  of 
wealth  does  not  even  aggravate  the  evil,  but,  at  most,  causes  it 
to  be  somewhat  earlier  felt.  It  is  in  vain  to  say,  that  all  mouths 
which  the  increase  of  mankind  calls  into  existence,  bring  with 
them  hands.  The  new  mouths  require  as  much  food  as  the  old 
ones,  and  the  hands  do  not  produce  as  much.  If  all  instruments 
of  production  were  held  in  joint  property  by  the  whole  people, 
and  the  produce  divided  with  perfect  equality  among  them,  and 
if  in  a  society  thus  constituted,  industry  were  as  energetic  and 
the  produce  as  ample  as  at  present,  there  would  be  enough  to 
make  all  the  existing  population  extremely  comfortable;  but 
when  that  population  had  doubled  itself,  as,  with  the  existing 
habits  of  the  people,  under  such  an  encouragement,  it  undoubt¬ 
edly  would  in  little  more  than  twenty  years,  what  would  then 
be  their  condition?  Unless  the  arts  of  production  were  in  the 
same  time  improved  in  an  almost  unexampled  degree,  the  in¬ 
ferior  soils  which  must  be  resorted  to,  and  the  more  laborious 
and  scantily  remunerative  cultivation  which  must  be  employed 
on  the  superior  soils,  to  procure  food  for  so  much  larger  a  popu¬ 
lation,  would,  by  an  insuperable  necessity,  render  every  individ¬ 
ual  in  the  community  poorer  than  before.  If  the  population 
continued  to  increase  at  the  same  rate,  a  time  would  soon  arrive 
when  no  one  would  have  more  than  mere  necessaries,  and,  soon 
after,  a  time  when  no  one  would  have  a  sufficiency  of  those,  and 
the  further  increase  of  population  would  be  arrested  by  death. 

Whether,  at  the  present  or  any  other  time,  the  produce  of  in¬ 
dustry,  proportionally  to  the  labor  employed,  is  increasing  or 


CONSEQUENCES  OF  THE  FOREGOING  LAWS  189 


diminishing,  and  the  average  condition  of  the  people  improving 
or  deteriorating,  depends  upon  whether  population  is  advancing 
faster  than  improvement,  or  improvement  than  population. 
After  a  degree  of  density  has  been  attained,  sufficient  to  allow 
the  principal  benefits  of  combination  of  labor,  all  further  in¬ 
crease  tends  in  itself  to  mischief,  so  far  as  regards  the  average 
condition  of  the  people;  but  the  progress  of  improvement  has  a 
counteracting  operation,  and  allows  of  increased  numbers  with¬ 
out  any  deterioration,  and  even  consistently  with  a  higher  aver¬ 
age  of  comfort.  Improvement  must  here  be  understood  in  a 
wide  sense,  including  not  only  new  industrial  inventions,  or  an 
extended  use  of  those  already  known,  but  improvements  in  in¬ 
stitutions,  education,  opinions,  and  human  affairs  generally,  pro¬ 
vided  they  tend,  as  almost  all  improvements  do,  to  give  new 
motives  or  new  facilities  to  production.  If  the  productive  powers 
of  the  country  increase  as  rapidly  as  advancing  numbers  call 
for  an  augmentation  of  produce,  it  is  not  necessary  to  obtain 
that  augmentation  by  the  cultivation  of  soils  more  sterile  than 
the  worst  already  under  culture,  or  by  applying  additional  la¬ 
bor  to  the  old  soils  at  a  diminished  advantage;  or  at  all  events 
this  loss  of  power  is  compensated  by  the  increased  efficiency 
with  which,  in  the  progress  of  improvement,  labor  is  employed 
in  manufactures.  In  one  way  or  the  other,  the  increased  popu¬ 
lation  is  provided  for,  and  all  are  as  well  off  as  before.  But  if 
the  growth  of  human  power  over  nature  is  suspended  or  slack¬ 
ened,  and  population  does  not  slacken  its  increase;  if,  with  only 
the  existing  command  over  natural  agencies,  those  agencies  are 
called  upon  for  an  increased  produce;  this  greater  produce  will 
not  be  afforded  to  the  increased  population,  without  either  de¬ 
manding  on  the  average  a  greater  effort  from  each,  or  on  the 
average  reducing  each  to  a  smaller  ration  out  of  the  aggregate 
produce. 

As  a  matter  of  fact,  at  some  periods  the  progress  of  popula¬ 
tion  has  been  the  more  rapid  of  the  two,  at  others  that  of  im¬ 
provement.  In  England  during  a  long  interval  preceding  the 
French  Revolution,  population  increased  slowly;  but  the  prog¬ 
ress  of  improvement,  at  least  in  agriculture,  would  seem  to  have 
been  still  slower,  since  though  nothing  occurred  to  lower  the 
value  of  the  precious  metals,  the  price  of  corn  rose  considerably, 
and  England,  from  an  exporting,  became  an  importing  country. 
This  evidence,  however,  is  short  of  conclusive,  inasmuch  as  the 


190 


POLITICAL  ECONOMY 


extraordinary  number  of  abundant  seasons  during  the  first  half 
of  the  century,  not  continuing  during  the  last,  was  a  cause  of  in¬ 
creased  price  in  the  later  period,  extrinsic  to  the  ordinary  prog¬ 
ress  of  society.  Whether  during  the  same  period  improvements 
in  manufactures,  or  diminished  cost  of  imported  commodities, 
made  amends  for  the  diminished  productiveness  of  labor  on  the 
land,  is  uncertain.  But  ever  since  the  great  mechanical  inven¬ 
tions  of  Watt,  Arkwright,  and  their  cotemporaries,  the  return  to 
labor  has  probably  increased  as  fast  as  the  population;  and 
would  have  outstripped  it,  if  that  very  augmentation  of  return 
had  not  called  forth  an  additional  portion  of  the  inherent  power 
of  multiplication  in  the  human  species.  During  the  twenty  or 
thirty  years  last  elapsed,  so  rapid  has  been  the  extension  of  im¬ 
proved  processes  of  agriculture,  that  even  the  land  yields  a 
greater  produce  in  proportion  to  the  labor  employed;  the  aver¬ 
age  price  of  corn  had  become  decidedly  lower,  even  before  the 
repeal  of  the  corn  laws  had  so  materially  lightened,  for  the  time 
being,  the  pressure  of  population  upon  production.  But  though 
improvement  may  during  a  certain  space  of  time  keep  up  with, 
or  even  surpass,  the  actual  increase  of  population,  it  assuredly 
never  comes  up  to  the  rate  of  increase  of  which  population  is 
capable :  and  nothing  could  have  prevented  a  general  deteriora¬ 
tion  in  the  condition  of  the  human  race,  were  it  not  that  popula¬ 
tion  has  in  fact  been  restrained.  Had  it  been  restrained  still 
more,  and  the  same  improvements  taken  place,  there  would  have 
been  a  larger  dividend  than  there  now  is,  for  the  nation  or  the 
species  at  large.  The  new  ground  wrung  from  nature  by  the 
improvements  would  not  have  been  all  used  up  in  the  support 
of  mere  numbers.  Though  the  gross  produce  would  not  have 
been  so  great,  there  would  have  been  a  greater  produce  per 
head  of  the  population. 

§  3.  When  the  growth  of  numbers  outstrips  the  progress  of 
improvement,  and  a  country  is  driven  to  obtain  the  means  of 
subsistence  on  terms  more  and  more  unfavorable,  by  the  inabil¬ 
ity  of  its  land  to  meet  additional  demands  except  on  more 
onerous  conditions;  there  are  two  expedients  by  which  it  may 
hope  to  mitigate  that  disagreeable  necessity,  even  though  no 
change  should  take  place  in  the  habits  of  the  people  with  re¬ 
spect  to  their  rate  of  increase.  One  of  these  expedients  is  the 
importation  of  food  from  abroad.  The  other  is  emigration. 

The  admission  of  cheaper  food  from  a  foreign  country,  is 


CONSEQUENCES  OF  THE  FOREGOING  LAWS  191 


equivalent  to  an  agricultural  invention  by  which  food  could  be 
raised  at  a  similarly  diminished  cost  at  home.  It  equally  in¬ 
creases  the  productive  power  of  labor.  The  return  was,  before, 
so  much  food  for  so  much  labor  employed  in  the  growth  of  food: 
the  return  is  now,  a  greater  quantity  of  food,  for  the  same  labor 
employed  in  producing  cottons  or  hardware,  or  some  other  com¬ 
modity  to  be  given  in  exchange  for  food.  The  one  improve¬ 
ment,  like  the  other,  throws  back  the  decline  of  the  productive 
power  of  labor  by  a  certain  distance:  but  in  the  one  case  as  in 
the  other,  it  immediately  resumes  its  course;  the  tide  which  has 
receded,  instantly  begins  to  re-advance.  It  might  seem,  indeed, 
that  when  a  country  draws  its  supply  of  food  from  so  wide  a  sur¬ 
face  as  the  whole  habitable  globe,  so  little  impression  can  be 
produced  on  that  great  expanse  by  any  increase  of  mouths  in 
one  small  corner  of  it,  that  the  inhabitants  of  the  country  may 
double  and  treble  their  numbers,  without  feeling  the  effect  in 
any  increased  tension  of  the  springs  of  production,  or  any  en¬ 
hancement  of  the  price  of  food  throughout  the  world.  But  in 
this  calculation  several  things  are  overlooked. 

In  the  first  place,  the  foreign  regions  from  which  corn  can 
be  imported  do  not  comprise  the  whole  globe,  but  those  parts  of 
it  almost  alone,  which  are  in  the  immediate  neighborhood  of 
coasts  or  navigable  rivers.  The  coast  is  the  part  of  most  coun¬ 
tries  which  is  earliest  and  most  thickly  peopled,  and  has  seldom 
any  food  to  spare.  The  chief  source  of  supply,  therefore,  is  the 
strip  of  country  along  the  banks  of  some  navigable  river,  as  the 
Nile,  the  Vistula,  or  the  Mississippi;  and  of  such  there  is  not,  in 
the  productive  regions  of  the  earth,  so  great  a  multitude,  as  to 
suffice  during  an  indefinite  time  for  a  rapidly  growing  demand, 
without  an  increasing  strain  on  the  productive  powers  of  the 
soil.  To  obtain  auxiliary  supplies  of  corn  from  the  interior  in 
any  abundance,  would,  in  the  existing  state  of  the  communica¬ 
tions,  be  hopeless.  By  improved  roads,  and  eventually  by  canals 
and  railways,  the  obstacle  will  be  so  reduced  as  not  to  be  in¬ 
superable  :  but  this  is  a  slow  progress ;  in  all  the  food-exporting 
countries  except  America,  a  very  slow  progress;  and  one  which 
cannot  keep  pace  with  population,  unless  the  increase  of  the  last 
is  very  effectually  restrained. 

In  the  next  place,  even  if  the  supply  were  drawn  from  the 
whole  instead  of  a  small  part  of  the  surface  of  the  exporting 
countries,  the  quantity  of  food  would  still  be  limited,  which 


192 


POLITICAL  ECONOMY 


could  be  obtained  from  them  without  an  increase  of  the  propor¬ 
tional  cost.  The  countries  which  export  food  may  be  divided 
into  two  classes;  those  in  which  the  effective  desire  of  accumu¬ 
lation  is  strong,  and  those  in  which  it  is  weak.  In  Australia 
and  the  United  States  of  America,  the  effective  desire  of  accu¬ 
mulation  is  strong;  capital  increases  fast,  and  the  production  of 
food  might  be  very  rapidly  extended.  But  in  such  countries 
population  also  increases  with  extraordinary  rapidity.  Their 
agriculture  has  to  provide  for  their  own  expanding  numbers, 
as  well  as  for  those  of  the  importing  countries.  They  must, 
therefore,  from  the  nature  of  the  case,  be  rapidly  driven,  if  not 
to  less  fertile,  at  least  what  is  equivalent,  to  remoter  and  less  ac¬ 
cessible  lands,  and  to  modes  of  cultivation  like  those  of  old  coun¬ 
tries,  less  productive  in  proportion  to  the  labor  and  expense. 

But  the  countries  which  have  at  the  same  time  cheap  food 
and  great  industrial  prosperity  are  few,  being  only  those  in  which 
the  arts  of  civilized  life  have  been  transferred  full  grown  to  a 
rich  and  uncultivated  soil.  Among  old  countries,  those  which 
are  able  to  export  food,  are  able  only  because  their  industry  is 
in  a  very  backward  state;  because  capital,  and  hence  population, 
have  never  increased  sufficiently  to  make  food  rise  to  a  higher 
price.  Such  countries  are  Russia,  Poland,  and  the  plains  of  the 
Danube.  In  those  regions  the  effective  desire  of  accumulation 
is  weak,  the  arts  of  production  most  imperfect,  capital  scanty, 
and  its  increase,  especially  from  domestic  sources,  slow.  When 
an  increased  demand  arose  for  food  to  be  exported  to  other 
countries,  it  would  only  be  very  gradually  that  food  could  be 
produced  to  meet  it.  The  capital  needed  could  not  be  obtained 
by  transfer  from  other  employments,  for  such  do  not  exist.  The 
cottons  or  hardware  which  would  be  received  from  England  in 
exchange  for  corn,  the  Russians  and  Poles  do  not  now  produce 
in  the  country:  they  go  without  them.  Something  might  in 
time  be  expected  from  the  increased  exertions  to  which  producers 
would  be  stimulated  by  the  market  opened  for  their  produce; 
but  to  such  increase  of  exertion,  the  habits  of  countries  whose 
agricultural  population  consists  of  serfs,  or  of  peasants  who  have 
but  just  emerged  from  a  servile  condition,  are  the  reverse  of 
favorable,  and  even  in  this  age  of  movement  these  habits  do  not 
rapidly  change.  If  a  greater  outlay  of  capital  is  relied  on  as  the 
source  from  which  the  produce  is  to  be  increased,  the  means 
must  either  be  obtained  by  the  slow  process  of  saving,  under 


CONSEQUENCES  OF  THE  FOREGOING  LAWS  193 


the  impulse  given  by  new  commodities  and  more  extended  inter¬ 
course  (and  in  that  case  the  population  would  most  likely  in¬ 
crease  as  fast),  or  must  be  brought  in  from  foreign  countries. 
If  England  is  to  obtain  a  rapidly  increasing  supply  of  corn  from 
Russia  or  Poland,  English  capital  must  go  there  to  produce  it. 
This,  however,  is  attended  with  so  many  difficulties,  as  are  equiv¬ 
alent  to  great  positive  disadvantages.  It  is  opposed  by  differ¬ 
ences  of  language,  differences  of  manners,  and  a  thousand  ob¬ 
stacles  arising  from  the  institutions  and  social  relations  of  the 
country:  and  after  all  it  would  inevitably  so  stimulate  popula¬ 
tion  on  the  spot,  that  nearly  all  the  increase  of  food  produced  by 
its  means,  would  probably  be  consumed  without  leaving  the 
country:  so  that  if  it  were  not  the  almost  only  mode  of  intro¬ 
ducing  foreign  arts  and  ideas,  and  giving  an  effectual  spur  to 
the  backward  civilization  of  those  countries,  little  reliance  could 
be  placed  on  it  for  increasing  the  exports,  and  supplying  other 
countries  with  a  progressive  and  indefinite  increase  of  food. 
But  to  improve  the  civilization  of  a  country  is  a  slow  process, 
and  gives  time  for  so  great  an  increase  of  population  both  in  the 
country  itself,  and  in  those  supplied  from  it,  that  its  effect  in 
keeping  down  the  price  of  food  against  the  increase  of  demand, 
is  not  likely  to  be  more  decisive  on  the  scale  of  all  Europe,  than 
on  the  smaller  one  of  a  particular  nation. 

The  law,  therefore,  of  diminishing  return  to  industry,  when¬ 
ever  population  makes  a  more  rapid  progress  than  improve¬ 
ment,  is  not  solely  applicable  to  countries  which  are  fed  from 
their  own  soil,  but  in  substance  applies  quite  as  much  to  those 
which  are  willing  to  draw  their  food  from  any  accessible  quarter 
that  can  afford  it  cheapest.  A  sudden  and  great  cheapening  of 
food,  indeed,  in  whatever  manner  produced,  would,  like  any 
other  sudden  improvement  in  the  arts  of  life,  throw  the  natural 
tendency  of  affairs  a  stage  or  two  further  back,  though  without 
altering  its  course.  There  is  one  contingency  connected  with 
freedom  of  importation,  which  may  yet  produce  temporary  ef¬ 
fects  greater  than  were  ever  contemplated  either  by  the  bitterest 
enemies  or  the  most  ardent  adherents  of  free-trade  in  food. 
Maize,  or  Indian  corn,  is  a  product  capable  of  being  supplied  in 
quantity  sufficient  to  feed  the  whole  country,  at  a  cost,  allowing 
for  difference  of  nutritive  quality,  cheaper  even  than  the  potato. 
If  maize  should  ever  substitute  itself  for  wheat  as  the  staple  food 
of  the  poor,  the  productive  power  of  labor  in  obtaining  food 
Vol.  I.— 13 


194 


POLITICAL  ECONOMY 


would  be  so  enormously  increased,  and  the  expense  of  main¬ 
taining  a  family  so  diminished,  that  it  would  require  perhaps 
some  generations  for  population,  even  if  it  started  forward  at 
an  American  pace,  to  overtake  this  great  accession  to  the  facili¬ 
ties  of  its  support. 

§  4.  Besides  the  importation  of  corn,  there  is  another  resource 
which  can  be  invoked  by  a  nation  whose  increasing  numbers 
press  hard,  not  against  their  capital,  but  against  the  productive 
capacity  of  their  land:  I  mean  Emigration,  especially  in  the 
form  of  Colonization.  Of  this  remedy  the  efficacy  as  far  as  it 
goes  is  real,  since  it  consists  in  seeking  elsewhere  those  unoccu¬ 
pied  tracts  of  fertile  land,  which  if  they  existed  at  home  would 
enable  the  demand  of  an  increasing  population  to  be  met  with¬ 
out  any  falling  off  in  the  productiveness  of  labor.  Accordingly, 
when  the  region  to  be  colonized  is  near  at  hand,  and  the  habits 
and  tastes  of  the  people  sufficiently  migratory,  this  remedy  is 
completely  effectual.  The  migration  from  the  older  parts  of  the 
American  Confederation  to  the  new  territories,  which  is  to  all 
intents  and  purposes  colonization,  is  what  enables  population 
to  go  on  unchecked  throughout  the  Union  without  hav¬ 
ing  yet  diminished  the  return  to  industry,  or  increased  the 
difficulty  of  earning  a  subsistence.  If  Australia  or  the  interior 
of  Canada  were  as  near  to  Great  Britain  as  Wisconsin  and 
Iowa  to  New  York;  if  the  superfluous  people  could  remove 
to  it  without  crossing  the  sea,  and  were  of  as  adventurous  and 
restless  a  character,  and  as  little  addicted  to  staying  at  home,  as 
their  kinsfolk  of  New  England,  those  unpeopled  continents  would 
render  the  same  service  to  the  United  Kingdom  which  the  old 
states  of  America  derive  from  the  new.  But  these  things  being 
as  they  are — though  a  judiciously  conducted  emigration  is  a 
most  important  resource  for  suddenly  lightening  the  pressure 
of  population  by  a  single  effort — and  though  in  such  an  extra¬ 
ordinary  case  as  that  of  Ireland  under  the  threefold  operation 
of  the  potato  failure,  the  poor  law,  and  the  general  turning  out 
of  tenantry  throughout  the  country,  spontaneous  emigration 
may  at  a  particular  crisis  remove  greater  multitudes  than  it  was 
ever  proposed  to  remove  at  once  by  any  national  scheme;  it  still 
remains  to  be  shown  by  experience  whether  a  permanent  stream 
of  emigration  can  be  kept  up,  sufficient  to  take  off,  as  in  America, 
all  that  portion  of  the  annual  increase  (when  proceeding  at  its 
greatest  rapidity)  which  being  in  excess  of  the  progress  made 


CONSEQUENCES  OF  THE  FOREGOING  LAWS  195 


during  the  same  short  period  in  the  arts  of  life,  tends  to  render 
living  more  difficult  for  every  averagely-situated  individual  in 
the  community.  And  unless  this  can  be  done,  emigration  can¬ 
not,  even  in  an  economical  point  of  view,  dispense  with  the  ne¬ 
cessity  of  checks  to  population.  Further  than  this  we  have  not 
to  speak  of  it  in  this  place.  The  general  subject  of  colonization 
as  a  practical  question,  its  importance  to  old  countries,  and  the 
principles  on  which  it  should  be  conducted,  will  be  discussed  at 
some  length  in  a  subsequent  portion  of  this  Treatise. 


BOOK  II 

DISTRIBUTION 

Chapter  I. — Of  Property 

HE  principles  which  have  been  set  forth  in  the  first  part 
of  this  Treatise,  are,  in  certain  respects,  strongly  dis¬ 
tinguished  from  those,  on  the  consideration  of  which 
we  are  now  about  to  enter.  The  laws  and  conditions  of  the 
production  of  wealth,  partake  of  the  character  of  physical  truths. 
There  is  nothing  optional^  or  arbitrary  in  them.  Whatever 
mankind  produce,  must  be  produced  in  the  modes,  and  under 

The  conditions,  imposed  by  the  constitution  of  external  thing^. 

ana  bv  the  inherent  properties  ot  their  own  bodily  and  mental 
Whether  they  like  it  or  not,  their  productions  will 
by  the  amount  of  their  previous  accumulation,  and, 
that  being  given,  it  will  be  proportional  to  their  energy,  their 
skill,  the  perfection  of  their  machinery,  and  their  judicious  use 
of  the  advantages  of  combined  labor.  Whether  they  like  it  or 
not,  a  double  quantity  of  labor  will  not  raise,  on  the  same  land, 
a  double  quantity  of  food,  unless  some  improvement  takes  place 
in  the  processes  of  cultivation.  Whether  they  like  it  or  not, 
the  unproductive  expenditure  of  individuals  will  pro  tanto  tend 
to  impoverish  the  community,  and  only  their  productive  expen¬ 
diture  will  enrich  it.  The  opinions,  or  the  wishes,  which  may 
exist  on  these  different  matters,  do  not  control  the  things  them¬ 
selves.  We  cannot,  indeed,  foresee  to  what  extent  the  modes 
of  production  may  be  altered,  or  the  productiveness  of  labor 
increased,  by  future  extensions  of  our  knowledge  of  the  laws 
of  nature,  suggesting  new  processes  of  industry  of  which  we 
have  at  present  no  conception.  But  howsoever  we  may  succeed 
in  making  for  ourselves  more  space  within  the  limits  set  by 
the  constitution  of  things,  we  know  that  there  must  be  limits. 
We  cannot  alter  the  ultimate  properties  either  of  matter  or 
mind,  but  can  only  employ  those  properties  more  or  less  suc¬ 
cessfully,  to  bring  about  the  events  in  which  we  are  interested. 

196 


struct 
be  limited 


PROPERTY 


197 


It  is  not_so  with  the  Distribution  of  .Wealthy  ThatJs  a. matter 
of  human  institution  solely.  The  things  once  there,  mankind^ 
individually  or  collectively,  can  do  with  them  as  they  like.  They 

fcan  place  them  at  the  disposal  of  whomsoever  they  please,  anft 

pn  whatever  terms.  Further,  in  the  social  state,  in  every  state 
except  total  solitude,  any  disposal  whatever  of  them  can  only 
take  place  by  the  consent  of  society,  or  rather  of  those  who  dis¬ 
pose  of  its  active  force.  Even  what  a  person  has  produced  by 
his  individual  toil,  unaided  by  anyone,  he  cannot  keep,  unless 
by  the  permission  of  society.  Not  only  can  society  take  it  from 
him,  but  individuals  could  and  would  take  it  from  him,  if  society 
only  remained  passive;  if  it  did  not  either  interfere  en  masse, 
or  employ  and  pay  people  for  the  purpose  of  preventing  him 
from  being  disturbed  in  the  possession.  The  distribution  of 
wealth,  therefore,  depends  on  the  laws  and  customs  of  society. 
The  rules  by  which  it  is  determined,  are  what  the  opinions  and 
feelings  of  the  ruling  portion  of  the  community  make  them,  and 
are  very  different  in  different  ages  and  countries;  and  might 
be  still  more  different,  if  mankind  so  chose. 

The  opinions  and  feelings  of  mankind,  doubtless,  are  not  a 
matter  of  chance.  They  are  consequences  of  the  fundamental 
laws  of  human  nature,  combined  with  the  existing  state  of 
knowledge  and  experience,  and  the  existing  condition  of  social 
institutions  and  intellectual  and  moral  culture.  But  the  laws 
of  the  generation  of  human  opinions  are  not  within  our  present 
subject.  They  are  part  of  the  general  theory  of  human  prog¬ 
ress,  a  far  larger  and  more  difficult  subject  of  inquiry  than 
political  economy.  We  have  here  to  consider,  not  the  causes, 
but  the  consequences  of  the  rules  according  to  which  wealth 
may  be  distributed.  Those,  at  least,  are  as  little  arbitrary,  and 
have  as  much  the  character  of  physical  laws,  as  the  laws  of 
production.  Human  beings  can  control  their  own  acts,  but 
not  the  consequences  of  their  acts  either  to  themselves  or  to 
others.  Society  can  subject  the  distribution  of  wealth  to  what¬ 
ever  rules  it  thinks  best ;  but  what  practical  results  will  flow 
from  the  operation  of  those  rules,  must  be  discovered,  like  any 
other  physical  or  mental  truths,  by  observation  and  reasoning. 

We  proceed,  then,  to  the  consideration  of  the  different  modes 
of  distributing  the  produce  of  land  and  labor,  which  have  been 
adopted  in  practice,  or  may  be  conceived  in  theory.  Among 
these,  our  attention  is  first  claimed  by  that  primary  and  funda- 


198 


POLITICAL  ECONOMY 


mental  institution,  on  which,  unless  in  some  exceptional  and 
very  limited  cases,  the  economical  arrangements  of  society  have 
always  rested,  though  in  its  secondary  features  it  has  varied, 
and  is  liable  to  vary.  I  mean,  of  course,  the  institution  of  in¬ 
dividual  property.  » 

§  2.  Private  property,  as  an  institution,  did  not  owe  its  origin 
to  any  of  those  considerations  of  utility,  which  plead  for  the 
maintenance  of  it  when  established.  Enough  is  known  of  rude 
ages,  both  from  history  and  from  analogous  states  of  society  in 
our  own  time,  to  show,  that  tribunals  (which  always  precede 
laws)  were  originally  established,  not  to  determine  rights,  but 
to  repress  violence  and  terminate  quarrels.  With  this  object 
chiefly  in  view,  they  naturally  enough  gave  legal  effect  to  first 
occupancy,  by  treating  as  the  aggressor  the  person  who  first 
commenced  violence,  by  turning,  or  attempting  to  turn,  another 
out  of  possession.  The  preservation  of  the  peace,  which  was 
the  original  object  of  civil  government,  was  thus  attained; 
while  by  confirming,  to  those  who  already  possessed  it,  even 
what  was  not  the  fruit  of  personal  exertion,  a  guarantee  was 
incidentally  given  to  them  and  others  that  they  would  be  pro¬ 
tected  in  what  was  so. 

In  considering  the  institution  of  property  as  a  question  in 
social  philosophy,  we  must  leave  out  of  consideration  its  actual 
origin  in  any  of  the  existing  nations  of  Europe.  We  may 
suppose  a  community  unhampered  by  any  previous  possession ; 
a  body  of  colonists,  occupying  for  the  first  time  an  uninhabited 
country ;  bringing  nothing  with  them  but  what  belonged  to 
them  in  common,  and  having  a  clear  field  for  the  adoption  of 
the  institutions  and  polity  which  they  judged  most  expedient; 
required,  therefore,  to  choose  whether  they  would  conduct  the 
work  of  production  on  the  principle  of  individual  property,  or 
on  some  system  of  common  ownership  and  collective  agency. 

If  private  property  were  adopted,  we  must  presume  that  it 
would  be  accompanied  by  none  of  the  initial  inequalities  and 
injustices  which  obstruct  the  beneficial  operation  of  the  prin¬ 
ciple  in  old  societies.  Every  full-grown  man  or  woman,  we 
must  suppose,  would  be  secured  in  the  unfettered  use  and  dis¬ 
posal  of  his  or  her  bodily  and  mental  faculties ;  and  the  instru¬ 
ments  of  production,  the  land  and  tools,  would  be  divided  fairly 
among  them,  so  that  all  might  start,  in  respect  to  outward  ap¬ 
pliances,  on  equal  terms.  It  is  possible  also  to  conceive  that  in 


PROPERTY 


199 


this  original  apportionment,  compensation  might  be  made  for 
the  injuries  of  nature,  and  the  balance  redressed  by  assigning 
to  the  less  robust  members  of  the  community  advantages  in  the 
distribution,  sufficient  to  put  them  on  a  par  with  the  rest.  But 
the  division,  once  made,  would  not  again  be  interfered  with ; 
individuals  would  be  left  to  their  own  exertions  and  to  the 
ordinary  chances,  for  making  an  advantageous  use  of  what  was 
assigned  to  them.  If  individual  property,  on  the  contrary,  were 
excluded,  the  plan  which  must  be  adopted  would  be  to  hold  the 
land  and  all  instruments  of  production  as  the  joint  property  of 
the  community,  and  to  carry  on  the  operations  of  industry  on 
the  common  account.  The  direction  of  the  labor  of  the  com¬ 
munity  would  devolve  upon  a  magistrate  or  magistrates,  whom 
we  may  suppose  elected  by  the  suffrages  of  the  community,  and 
whom  we  must  assume  to  be  voluntarily  obeyed  by  them.  The 
division  of  the  produce  would  in  like  manner  be  a  public  act. 
The  principle  might  either  be  that  of  complete  equality,  or  of 
apportionment  to  the  necessities  or  deserts  of  individuals,  in 
whatever  manner  might  be  conformable  to  the  ideas  of  justice 
or  policy  prevailing  in  the  community. 

Examples  of  such  associations,  on  a  small  scale,  are  the  mo¬ 
nastic  orders,  the  Moravians,  the  followers  of  Rapp,  and  others : 
and  from  the  hopes  which  they  hold  out  of  relief  from  the  mis¬ 
eries  and  iniquities  of  a  state  of  much  inequality  of  wealth, 
schemes  for  a  larger  application  of  the  same  idea  have  reap¬ 
peared  and  become  popular  at  all  periods  of  active  speculation 
on  the  first  principles  of  society.  In  an  age  like  the  present, 
when  a  general  reconsideration  of  all  first  principles  is  felt 
to  be  inevitable,  and  when  more  than  at  any  former  period  of 
history  the  suffering  portions  of  the  community  have  a  voice 
in  the  discussion,  it  was  impossible  but  that  ideas  of  this  nature 
should  spread  far  and  wide.  The  late  revolutions  in  Europe 
have  thrown  up  a  great  amount  of  speculation  of  this  character, 
and  an  unusual  share  of  attention  has  consequently  been  drawn 
to  the  various  forms  which  these  ideas  have  assumed:  nor  is 
this  attention  likely  to  diminish,  but  on  the  contrary,  to  increase 
more  and  more. 

The_assailants_of  the  principle  of  individual  ^property  may  be 
divided  into  two  classes:  those  whose  scheme  imp!Ies~absolute 
equality  in  the  distribution  of  the  physical  means  of  life  and 
enjoyment,  and  those  who  admit  inequality,  but  grounded  on 


200 


POLITICAL  ECONOMY 


|ome  prinriple.  orsqpposed  principle,  of  justice  or  general  ex¬ 
pediency,  and  not,  like  so  many  of  the  existing  social  inequal- 
ities,  dependent  on  accident  alone.  At  the  head  of  the  first  class, 
as  the  earliest  of  those  belonging  to  the  present  generation,  must 
be  placed  ^Mr.  jQmen  and  his  followers.  M.  Louis  Blanc  and 
M.  Cabet  have  more  recently  become  conspicuous  as  apostles 
of  similar  doctrines  (though  the  former  advocates  equality  of 
distribution  only  as  a  transition  to  a  still  higher  standard  of 
justice,  that  all  should  work  according  to  their  capacity,  and 
receive  according  to  their  wants).  The  characteristic  name  for 
this  economical  system  is  Communism,  a  word  of  continental 
origin,  only  of  late  introduced  into  this  country.  The  word 
Socialism,  which  originated  among  the  English  Communists, 
and  was  assumed  by  them  as  a  name  to  designate  their  own 
doctrine,  is  now,  on  the  Continent,  employed  in  a  larger  sense ; 
not  necessarily  implying  Communism,  or  the  entire  abolition 
of  private  property,  but  applied  to  any  system  which  requires 
that  the  land  and  the  instruments  of  production  should  be  the 
property,  not  of  individuals,  but  of  communities  or  associations, 
or  of  the  government.  Among  such  systems,  the  two  of  highest 


intellectual  pretension  are  those  which,  from  the  names  of  their 
real  or  reputed  authors,  have  been  called  St.  Simonism  and 
Fourierism ;  the  former,  defunct  as  a  system,  but  wTucTrtluring 
the"Tew~y£ars  of  its  public  promulgation,  sowed  the  seeds  of 
nearly  all  the  Socialist  tendencies  which  have  since  spread  so 
widely  in  France :  the  second,  still  flourishing  in  the  number, 
talent,  and  zeal  of  its  adherents. 

§  3.  Whatever  may  be  the  merits  or  defects  of  these  various 
schemes,  they  cannot  be  truly  .sakL  to  be  impracticable.  No 
reasonable  person  can  doubt  that  a  village  community,  com¬ 
posed  of  a  few  thousand  inhabitants  cultivating  in  joint  owner¬ 
ship  the  same  extent  of  land  which  at  present  feeds  that  number 
of  people,  and  producing  by  combined  labor  and  the  most  im¬ 
proved  processes  the  manufactured  articles  which  they  re¬ 
quired,  could  raise  an  amount  of  productions  sufficient  to  main¬ 
tain  them  in  comfort ;  and  would  find  the  means  of  obtaining, 
and  if  need  be,  exacting,  the  quantity  of  labor  necessary  for 
this  purpose,  from  every  member  of  the  association  who  was 
capable  of  work. 

The  objection  ordinarily  made  to  a  system  of  community  of 
property  and  equal  distribution  of  the  produce,  that  each  per- 


PROPERTY 


201 


son  would  be  incessantly  occupied  in  evading  his  fair  share  of 
the  work,  points,  undoubtedly,  to  a  real  difficulty.  But  those 
who  urge  this  objection,  forget  to  how  great  an  extent  the 
same  difficulty  exists  under  the  system  on  which  nine-tenths 
of  the  business  of  society  is  now  conducted.  The  objection  sup¬ 
poses,  that  honest  and  efficient  labor  is  only  to  be  had  from 
those  who  are  themselves  individually  to  reap  the  benefit  of 
their  own  exertions.  But  how  small  a  part  of  all  the  labor  per¬ 
formed  in  England,  from  the  lowest  paid  to  the  highest,  is  done 
by  persons  working  for  their  own  benefit.  From  the  Irish  reaper 
or  hodman  to  the  chief  justice  or  the  minister  of  state,  nearly 
all  the  work  of  society  is  remunerated  by  day  wages  or  fixed 
salaries.  A  factory  operative  has  less  personal  interest  in  his 
work  than  a  member  of  a  Communist  association,  since  he  is 
not,  like  him,  working  for  a  partnership  of  which  he  is  himself 
a  member.  It  will  no  doubt  be  said,  that  though  the  laborers 
themselves  have  not,  in  most  cases,  a  personal  interest  in  their 
work,  they  are  watched  and  superintended,  and  their  labor  di¬ 
rected,  and  the  mental  part  of  the  labor  performed,  by  persons 
who  have.  Even  this,  however,  is  far  from  being  universally 
the  fact.  In  all  public,  and  many  of  the  largest  and  most  suc¬ 
cessful  private  undertakings,  not  only  the  labors  of  detail,  but 
the  control  and  superintendence  are  intrusted  to  salaried  offi¬ 
cers.  And  though  the  “  master’s  eye,”  when  the  master  is  vigi¬ 
lant  and  intelligent,  is  of  proverbial  value,  it  must  be  remem¬ 
bered  that  in  a  Socialist  farm  or  manufactory,  each  laborer 
would  be  under  the  eye  not  of  one  master,  but  of  the  whole 
community.  In  the  extreme  case  of  obstinate  perseverance  in 
not  performing  the  due  share  of  work,  the  community  would 
have  the  same  resources  which  society  now  has  for  compelling 
conformity  to  the  necessary  conditions  of  the  association.  Dis¬ 
missal,  the  only  remedy  at  present,  is  no  remedy  when  any  other 
laborer  who  may  be  engaged  does  no  better  than  his  prede¬ 
cessor:  the  power  of  dismissal  only  enables  an  employer  to 
obtain  from  his  workmen  the  customary  amount  of  labor,  but 
that  customary  labor  may  be  of  any  degree  of  inefficiency.  Even 
the  laborer  who  loses  his  employment  by  idleness  or  negligence, 
has  nothing  worse  to  suffer,  in  the  most  unfavorable  case,  than 
the  discipline  of  a  workhouse,  and  if  the  desire  to  avoid  this 
be  a  sufficient  motive  in  the  one  system,  it  would  be  sufficient 
in  the  other.  I  am  not  undervaluing  the  strength  of  the  incite- 


202 


POLITICAL  ECONOMY 


ment  given  to  labor  when  the  whole  or  a  large  share  of  the 
benefit  of  extra  exertion  belongs  to  the  laborer.  But  under  the 
present  system  of  industry  this  incitement,  in  the  great  majority 
of  cases,  does  not  exist.  If  Communistic  labor  might  be  less 
vigorous  than  that  of  a  peasant  proprietor,  or  a  workman  labor¬ 
ing  on  his  own  account,  it  would  probably  be  more  energetic 
than  that  of  a  laborer  for  hire,  who  has  no  personal  interest  in 
the  matter  at  all.  The  neglect  by  the  uneducated  classes  of 
laborers  for  hire,  of  the  duties  which  they  engage  to  perform, 
is  in  the  present  state  of  society  most  flagrant.  Now  it  is  an  ad¬ 
mitted  condition  of  the  Communist  scheme  that  all  shall  be 
educated :  and  this  being  supposed,  the  duties  of  the  members 
of  the  association  would  doubtless  be  as  diligently  performed 
as  those  of  the  generality  of  salaried  officers  in  the  middle  or 
higher  classes ;  who  are  not  supposed  to  be  necessarily  unfaith¬ 
ful  to  their  trust,  because  so  long  as  they  are  not  dismissed,  their 
pay  is  the  same  in  however  lax  a  manner  their  duty  is  fulfilled. 
Undoubtedly,  as  a  general  rule,  remuneration  by  fixed  salaries 
does  not  in  any  class  of  functionaries  produce  the  maximum 
of  zeal :  and  this  is  as  much  as  can  be  reasonably  alleged  against 
Communistic  labor. 

That  even  this  inferiority  would  necessarily  exist,  is  by  no 
means  so  certain  as  is  assumed  by  those  who  are  little  used 
to  carry  their  minds  beyond  the  state  of  things  with  which 
they  are  familiar.  Mankind  are  capable  of  a  far  greater  amount 
of  public  spirit  than  the  present  age  is  accustomed  to  suppose 
possible.  History  bears  witness  to  the  success  with  which  large 
bodies  of  human  beings  may  be  trained  to  feel  the  public  in¬ 
terest  their  own.  And  no  soil  could  be  more  favorable  to  the 
growth  of  such  a  feeling,  than  a  Communist  association,  since 
all  the  ambition,  and  the  bodily  and  mental  activity,  which  are 
now  exerted  in  the  pursuit  of  separate  and  self-regarding  in¬ 
terests,  would  require  another  sphere  of  employment,  and  would 
naturally  find  it  in  the  pursuit  of  the  general  benefit  of  the  com¬ 
munity.  The  samg-xaiise,  SO  often_as signed  in  explanation  pi 
the  devotion  of  the  Catholic  priest  or  monk  to  the  interest  of 
liis  order— that  he  has  no  interest  apart  from  it — would,  under 
(Communism,  attach  the  citizen  to  the  community.  And  inde- 
pendently  of  the  public  motive,  every  member  of  the  association 
would  be  amenable  to  the  most  universal,  and  one  of  the  strong¬ 
est  of  personal  motives,  that  of  public  opinion.  The  force  of 


PROPERTY 


203 


this  motive  in  deterring  from  any  act  or  omission  positively 
reproved  by  the  community,  no  one  is  likely  to  deny ;  but  the 
power  also  of  emulation,  in  exciting  to  the  most  strenuous 
exertions  for  the  sake  of  the  approbation  and  admiration  of 
others,  is  borne  witness  to  by  experience  in  every  situation  in 
which  human  beings  publicly  compete  with  one  another,  even 
if  it  be  in  things  frivolous,  or  from  which  the  public  derive  no 
benefit.  A  contest,  who  can  do  most  for  the  common  good,  is 
not  the  kind  of  competition  which  Socialists  repudiate.  To 
what  extent,  therefore,  the  energy  of  labor  would  be  diminished 
by  Communism,  or  whether  in  the  long  run  it  would  be  dimin¬ 
ished  at  all,  must  be  considered  for  the  present  an  undecided 
question. 

Another  of  the  objections  to  Communism  is  similar  to  that, 
so^oTteiTurged  against  poor-laws :  that  if  every  member  of  the 
community  were  assured  of  subsistence  for  himself  and  any 
number  of  children,  on  the  sole  condition  of  willingness  to 
work,  prudential  restraint  on  the  multiplication  of  mankind 
would  be  at  an  end,  and  population  would  start  forward  at  a 
rate  which  would  reduce  the  community  through  successive 
stages  of  increasing*  discomfort  to  actual  starvation.  There 
would  certainly  be  much  ground  for  this  apprehension  if  Com¬ 
munism  provided  no  motives  to  restraint,  equivalent  to  those 
which  it  would  take  away.  But  Communism  is  precisely  the 
state  ofthings  in  which  opinion^  might  be  expected  to  declare 
Itself  wlthgreatest  intensity  against  this  kind  of  selfish  intem¬ 
perance.  Any  augmentation  of  numbers  which  diminished  the 
comfort  or  increased  the  toil  of  the  mass,  would  then  cause 
(which  now  it  does  not)  immediate  and  unmistakable  incon¬ 
venience  to  every  individual  in  the  association ;  inconvenience 
which  could  not  then  be  imputed  to  the  avarice  of  employers,  or 
the  unjust  privileges  of  the  rich.  In  such  altered  circumstances 
opinion  could  not  fail  to  reprobate,  and  if  reprobation  did  not 
suffice,  to  repress  by  penalties  of  some  description,  this  or  any 
other  culpable  self-indulgence  at  the  expense  of  the  community. 
The  Communistic  scheme,  instead  of  being  peculiarly  open  to 
the  objection  drawn  from  danger  of  over-population,  has  the 
recommendation  of  tending  in  an  especial  degree  to  the  pre¬ 
vention  of  that  evil. 

A  more  real  difficulty  is  that  of  fairly  apportioning  the  labor 
of  the  community  among  its  members.  There  are  many  kinds 


204 


POLITICAL  ECONOMY 


■# 


of  work,  and  by  what  standard  are  they  to  be  measured  one 
against  another?  Who  is  to  judge  how  much  cotton  spinning, 
or  distributing  goods  from  the  stores,  or  bricklaying,  or  chim¬ 
ney  sweeping,  is  equivalent  to  so  much  ploughing?  The  diffi¬ 
culty  of  making  the  adjustment  between  different  qualities  of 
labor  is  so  strongly  felt  by  Communist  writers,  that  they  have 
usually  thought  it  necessary  to  provide  that  all  should  work 
by  turns  at  every  description  of  useful  labor :  an  arrangement 
which  by  putting  an  end  to  the  division  of  employments,  would 
sacrifice  so  much  of  the  advantage  of  co-operative  production 
as  greatly  to  diminish  the  productiveness  of  labor.  Besides, 
even  in  the  same  kind  of  work,  nominal  equality  of  labor  would 
be  so  great  a  real  inequality,  that  the  feeling  of  justice  would 
revolt  against  its  being  enforced.  All  persons  are  not  equally 
fit  for  all  labor ;  and  the  same  quantity  of  labor  is  an  unequal 
burden  on  the  weak  and  the  strong,  the  hardy  and  the  delicate, 
the  quick  and  the  slow,  the  dull  and  the  intelligent. 

But  these  difficulties,  though  real,  are  not  necessarily  insuper¬ 
able.  The  apportionment  of  work  to  the  strength  and  capacities 
of  individuals,  the  mitigation  of  a  general  rule  to  provide  for 
cases  in  which  it  would  operate  harshly,  are  not  problems  to 
which  human  intelligence,  guided  by  a  sense  of  justice,  would 
be  inadequate.  And^he  wprsLand  jiqQSt  unjust  arrangement 
which  could  be  made  xffAhese  ppints,  under  a  system  aiming 
at  equality,  would  be  so  far  short  of  the  inequality  and  injustice 
with  which  labor  (not  to  speak  of  remuneration)  is  now  appor¬ 
tioned,  as  to  be  scarcely  worth  counting  in  the  comparison.  We 
must  remember  too  that  Communism,  as  a  system  of  society, 
exists  only  in  idea ;  that  its  difficulties,  at  present,  are  much 
better  understood  than  its  resources ;  and  that  the  intellect  of 
mankind  is  only  beginning  to  contrive  the  means  of  organizing 
it  in  detail,  so  as  to  overcome  the  one  and  derive  the  greatest 
advantage  from  the  other. 

If,  therefore,  the  choice  were  to  be  made  between  Communism 
with  all  its  chances,  and  the  present  state  of  society  with  all  its 
sufferings  and  injustices;  if  the  institution  of  private  property 
necessarily  carried  with  it  as  a  consequence,  that  the  produce 
of  labor  should  be  apportioned  as  we  now  see  it,  almost  in  an 
inverse  ratio  to  the  labor — the  largest  portions  to  those  who 
have  never  worked  at  all,  the  next  largest  to  those  whose  work 
is  almost  nominal,  and  so  in  a  descending  scale,  the  remunera- 


PROPERTY 


205 


tion  dwindling  as  the  work  grows  harder  and  more  disagreeable, 
until  the  most  fatiguing  and  exhausting  bodily  labor  cannot 
count  with  certainty  on  being  able  to  earn  even  the  necessaries 
of  life ;  if  this,  or  Communism,  were  the  alternative,  all  the 
difficulties,  great  or  small,  of  Communism  would  be  but  as  dust 
‘in  the  balance.  ^But  to  make  the  comparison  applicable,  we 
must~compare  Communism  at  its  best,  with  the  regime  of  in¬ 
dividual  property,  not  as  it  is,  but  as  it  might  be  made.  JThe 
principle  of  private  property  has  never  yet  had  a  fair  trial  in 
any  country ;  and  less  so,  perhaps,  in  this  country  than  in  some 
others.  The  social  arrangements  of  modern  Europe  commenced 
from  a  distribution  of  property  which  was  the  result,  not  of 
just  partition,  or  acquisition  by  industry,  but  of  conquest  and 
violence:  and  notwithstanding  what  industry  has  been  doing 
for  many  centuries  to  modify  the  work  of  force,  the  system 
still  retains  many  and  large  traces  of  its  origin.  The  laws 
of  property  have  never  yet  conformed  to  the  principles  on 
which  the  justification  of  private  property  rests.  They  have 
made  property  of  things  which  never  ought  to  be  property,  and 
absolute  property  where  only  a  qualified  property  ought  to 
exist.  They  have  not  held  the  balance  fairly  between  human 
beings,  but  have  heaped  impediments  upon  some,  to  give  ad¬ 
vantage  to  others ;  they  have  purposely  fostered  inequalities, 
and  prevented  all  from  starting  fair  in  the  race.  That  all  should 
indeed  start  on  perfectly  equal  terms,  is  inconsistent  with  any 
law  of  private  property:  but  if  as  much  pains  as  has  been  taken 
to  aggravate  the  inequality  of  chances  arising  from  the  natural 
working  of  the  principle,  had  been  taken  to  temper  that  ine¬ 
quality  by  every  means  not  subversive  of  the  principle  itself; 
if  the  tendency  of  legislation  had  been  to  favor  the  diffusion,  in¬ 
stead  of  the  concentration  of  wealth — to  encourage  the  subdi¬ 
vision  of  the  large  masses,  instead  of  striving  to  keep  them 
together ;  the  principle  of  individual  property  would  have  been 
found  to  have  no  necessary  connection  with  the  physical  and 
social  evils  which  almost  all  Socialist  writers  assume  to  be 
inseparable  from  it. 

Private  property,  in  every  defence  made  of  it,  is  supposed 
to  mean,  the  guarantee  to  individuals,  of  the  fruits  of  their 
own  labor  and  abstinence.  The  guarantee  to  them  of  the  fruits 
of  the  labor  and  abstinence  of  others,  transmitted  to  them  with¬ 
out  any  merit  or  exertion  of  their  own,  is  not  of  the  essence 


206 


POLITICAL  ECONOMY 


of  the  institution,  but  a  mere  incidental  consequence,  which 
when  it  reaches  a  certain  height,  does  not  promote,  but  conflicts 
with  the  ends  which  render  private  property  legitimate.  To 
judge  of  the  final  destination  of  the  institution  of  property,  we 
must  suppose  everything  rectified,  which  causes  the  institution 
to  work  in  a  manner  opposed  to  that  equitable  principle,  of  pro¬ 
portion  between  remuneration  and  exertion,  on  which  in  every 
vindication  of  it  that  will  bear  the  light,  it  is  assumed  to  be 
grounded.  We  must  also  suppose  two  conditions  realized,  with¬ 
out  which  neither  Communism  nor  any  other  laws  or  institutions 
could  make  the  condition  of  the  mass  of  mankind  other  than 
degraded  and  miserable.  One  of  these  conditions  is,  universal 
education ;  the  other,  a  due  limitation  of  the  numbers  of  the 
community.  With  these,  there  could  be  no  poverty  even  under 
'  the  present  social  institutions :  and  these  being  supposed,  the 
question  of  Socialism  is  not,  as  generally  stated  by  Socialists, 
a  question  of  flying  to  the  sole  refuge  against  the  evils  which 
now  bear  down  humanity ;  but  a  mere  question  of  comparative 
advantages,  which  futurity  must  determine.  We  are  too  ig¬ 
norant  either  of  what  individual  agency  in  its  best  form,  or 
Socialism  in  its  best  form,  can  accomplish,  to  be  qualified  to 
decide  which  of  the  two  will  be  the  ultimate  form  of  human 
society. 

If  a  conjecture  may  be  hazarded,  the  decision  will  probably 
depend  mainly  on  one  consideration,  viz.,  which  of  the  two  sys- 
tems_js_consistent  with  the  greatest  amount  of  human  liberty 
and  spontaneity.  After  the  means  of  subsistence  are  assured, 
the  next  in  strength  of  the  personal  wants  of  human  beings  is 
liberty;  and  (unlike  the  physical  wants,  which  as  civilization 
advances  become  more  moderate  and  more  amenable  to  control) 
it  increases  instead  of  diminishing  in  intensity,  as  the  intelli¬ 
gence  and  the  moral  faculties  are  more  developed.  The  perfec¬ 
tion  both  of  social  arrangements  and  of  practical  morality  would 
be,  to  secure  to  all  persons  complete  independence  and  freedom 
of  action,  subject  to  no  restriction  but  that  of  not  doing  injury 
to  others:  and  the  education  which  taught  or  the  social  insti¬ 
tutions  which  required  them  to  exchange  the  control  of  their 
own  actions  for  any  amount  of  comfort  or  affluence,  or  to 
renounce  liberty  for  the  sake  of  equality,  would  deprive  them 
of  one  of  the  most  elevated  characteristics  of  human  nature. 
It  remains  to  be  discovered  how  far  the  preservation  of  this 


PROPERTY 


207 


characteristic  would  be  found  compatible  with  the  communistic 
organization  of  society.  No  doubt,  this,  like  all  the  other  ob¬ 
jections  to  the  Socialist  schemes,  is  vastly  exaggerated.  The 
members  of  the  association  need  not  be  required  to  live  together 
more  than  they  do  now,  nor  need  they  be  controlled  in  the 
disposal  of  their  individual  share  of  the  produce,  and  of  the 
probably  large  amount  of  leisure  which,  if  they  limited  their 
production  to  things  really  worth  producing,  they  would  pos¬ 
sess.  Individuals  need  not  be  chained  to  an  occupation,  or 
to  a  particular  locality.  The  restraints  of  Communism  would 
be  freedom  in  comparison  with  the  present  condition  of  the 
majority  of  the  human  race.  The  generality  of  laborers  in 
this  and  most  other  countries,  have  as  little  choice  of  occupa¬ 
tion  or  freedom  of  locomotion,  are  practically  as  dependent 
on  fixed  rules  and  on  the  will  of  others,  as  they  could  be  on 
any  system  short  of  actual  slavery ;  to  say  nothing  of  the  entire 
domestic  subjection  of  one-half  the  species,  to  which  it  is  the 
signal  honor  of  Owenism  and  most  other  forms  of  Socialism 
that  they  assign  equal  rights,  in  all  respects,  with  those  of  the 
hitherto  dominant  sex.  But  it  is  not  by  comparison  with  the 
present  bad  state  of  society  that  the  claims  of  Communism  can 

Jpje  estimated :  nor  is  it  sufficient  that  it  should  promise  greater 
personal  and  mental  freedom  than  is  now  enjoyed  by  those  who 

have  not  enough  of  either  to  deserve  the  name. _ The  question 

is  whether  there  would  be  any  asylum  left  for  individuality 
of  character;  whether  public  opinion  would  not  be  a  tyrannical 
yoke ;  whether  the  absolute  dependence  of  each  on  all,  and 
surveillance  of  each  by  all,  would  not  grind  all  down  into  a 
tame  uniformity  of  thoughts,  feelings,  and  actions.  This  is 
already  one  of  the  glaring  evils  of  the  existing  state  of  society, 
notwithstanding  a  much  greater  diversity  of  education  and 
pursuits,  and  a  much  less  absolute  dependence  of  the  individual 
on  the  mass,  than  would  exist  in  the  Communistic  regime.  No 
society  in  which  eccentricity  is  a  matter  of  reproach,  can  be  in 
.  a  wholesome  state.  It  is  yet  to  be  ascertained  whether  the  Com-  > 
munistic  scheme  would  be  consistent  with  that  multiform  de¬ 
velopment  of  human  nature,  those  manifold  unlikenesses,  that 
diversity  of  tastes  and  talents,  and  variety  of  intellectual  points 
of  view,  which  not  only  form  a  great  part  of  the  interest  of 
human  life,  but  by  bringing  intellects  into  a  stimulating  colli¬ 
sion,  and  by  presenting  to  each  innumerable  notions  that  he 


208 


POLITICAL  ECONOMY 


would  not  have  conceived  of  himself,  are  the  mainspring  of 
mental  and  moral  progression. 

§  4.  I  have  thus  far  confined  my  observations  to  the  Com¬ 
munistic  doctrine,  which  forms  the  extreme  limit  of  Socialism ; 
according  to  which  not  only  the  instruments  of  production,  the 
land  and  capital,  are  the  joint  property  of  the  community,  but 
the  produce  is  divided  and  the  labor  apportioned,  as  far  as 
possible,  equally.  The  objections,  whether  well  or  ill  grounded, 
to  which  Socialism  is  liable,  apply  to  this  form  of  it  in  their 
greatest  force.  The  other  varieties  of  Socialism  mainly  differ 
from  Communism,  in  not  relying  solely  on  what  M.  Louis  Blanc 
calls  the  point  of  honor  of  industry,  but  retaining  more  or  less 
of  the  incentives  to  labor  derived  from  private  pecuniary  in¬ 
terest.  Thus  it  is  already  a  modification  of  the  strict  theory  of 
Communism,  when  the  principle  is  professed  of  proportioning 
remuneration  to  labor.  The  attempts  which  have  been  made 
in  France  to  carry  Socialism  into  practical  effect,  by  associations 
of  workmen  manufacturing  on  their  own  account,  mostly  began 
by  sharing  the  remuneration  equally,  without  regard  to  the 
quantity  of  work  done  by  the  individual :  but  in  almost  every 
case  this  plan  was  after  a  short  time  abandoned,  and  recourse 
was  had  to  working  by  the  piece.  The  original  principle  ap¬ 
peals  to  a  higher  standard  of  justice,  and  is  adapted  to  a  much 
higher  moral  condition  of  human  nature.  The  proportioning 
of  remuneration  to  work  done,  is  really  just,  only  in  so  far  as 
the  more  or  less  of  the  work  is  a  matter  of  choice:  when  it 
depends  on  natural  difference  of  strength  or  capacity,  this 
principle  of  remuneration  is  in  itself  an  injustice:  It  is  giving 
to  those  who  have;  assigning  most  to  those  who  are  already 
most  favored  by  nature.  Considered,  however,  as  a  compro¬ 
mise  with  the  selfish  type  of  character  formed  by  the  present 
standard  of  morality,  and  fostered  by  the  existing  social  insti¬ 
tutions,  it  is  highly  expedient;  and  until  education  shall  have 
been  entirely  regenerated,  is  far  more  likely  to  prove  immedi¬ 
ately  successful,  than  an  attempt  at  a  higher  ideal. 

The  two  elaborate  forms  of  non-communistic  Socialism 
known  as  St.  Simonism  and  Fourierism,  are  totally  free  from  the 
objections  usually  urged  against  Communism  ;  and  though  they 
are  open  to  others  of  their  own,  yet  by  the  great  intellectual 
power  which  in  many  respects  distinguishes  them,  and  by  their 
large  and  philosophic  treatment  of  some  of  the  fundamental 


PROPERTY, 


209 


problems  of  society  and  morality,  they  may  justly  be  counted 
among  the  most  remarkable  productions  of  the  past  and  present 
age. 

The  St.  Simonian  scheme  does  not  contemplate  an  equal, 
but  an  unequal  division  of  the  produce ;  it  does  not  propose 
that  all  should  be  occupied  alike,  but  differently,  according  to 
their  vocation  or  capacity ;  the  function  of  each  being  assigned, 
like  grades  in  a  regiment,  by  the  choice  of  the  directing  author¬ 
ity,  and  the  remuneration  being  by  salary,  proportioned  to  the 
importance,  in  the  eyes  of  that  authority,  of  the  function  itself, 
and  the  merits  of  the  person  who  fulfils  it.  For  the  constitu¬ 
tion  of  the  ruling  body,  different  plans  might  be  adopted, 
consistently  with  the  essentials  of  the  system.  It  might  be  ap¬ 
pointed  by  popular  suffrage.  In  the  idea  of  the  original  au¬ 
thors,  the  rulers  were  supposed  to  be  persons  of  genius  and 
virtue,  who  obtained  the  voluntary  adhesion  of  the  rest  by  the 
force  of  mental  superiority.  That  the  scheme  might  in  some 
peculiar  states  of  society  work  with  advantage,  is  not  improb¬ 
able.  There  is  indeed  a  successful  experiment,  of  a  somewhat 
similar~kind,  on  record,  to  which  I  have  once  alluded;  that  of 
the  Jesuits  in  Paraguay.  ^  A  race  of  savages,  belonging  to  a 
portroTToTrnankTnd  more  averse  to  consecutive  exertion  for  a 
distant  object  than  any  other  authentically  known  to  us,  was 
brought  under  the  mental  dominion  of  civilized  and  instructed 
men  who  were  united  among  themselves  by  a  system  of  com¬ 
munity  of  goods.  To  the  absolute  authorty  of  these  men  they 
reverentially  submitted  themselves,  and  were  induced  by  them 
to  learn  the  arts  of  civilized  life,  and  to  practice  labors  for  the 
community,  which  no  inducement  that  could  have  been  offered 
would  have  prevailed  on  them  to  practise  for  themselves.  This 
social  system  was  of  short  duration,  being  prematurely  de¬ 
stroyed  by  diplomatic  arrangements  and  foreign  force.  That 
it  could  be  brought  into  action  at  all  was  probably  owing  to  the 
immense  distance  in  point  of  knowledge  and  intellect  which 
separated  the  few  rulers  from  the  whole  body  of  the  ruled,  with¬ 
out  any  intermediate  orders,  either  social  or  intellectual.  In  any 
other  circumstances  it  would  probably  have  been  a  complete 
failure.  It  supposes  an  absolute  despotism  in  the  heads  of  the 
association;  which  would  probably  not  be  much  improved  if 
the  depositaries  of  the  despotism  (contrary  to  the  views  of  the 
authors  of  the  system)  were  varied  from  time  to  time  according 

VOL.  I. — 14 


210 


POLITICAL  ECONOMY 


to  the  result  of  a  popular  canvass.  But  to  suppose  that  one 
or  a  few  human  beings,  howsoever  selected,  could,  by  whatever 
machinery  of  subordinate  agency,  be  qualified  to  adapt  each 
person’s  work  to  his  capacity,  and  proportion  each  person’s 
remuneration  to  his  merits — to  be,  in  fact,  the  dispensers  of 
distributive  justice  to  every  member  of  a  community;  or  that 
any  use  which  they  could  make  of  this  power  would  give  general 
satisfaction,  or  would  be  submitted  to  without  the  aid  of  force 
— is  a  supposition  almost  too  chimerical  to  be  reasoned  against. 
A  fixed  rule,  like  that  of  equality,  might  be  acquiesced  in,  and 
so  might  chance,  or  an  external  necessity ;  but  that  a  handful 
of  human  beings  should  weigh  everybody  in  the  balance,  and 
give  more  to  one  and  less  to  another  at  their  sole  pleasure  and 
judgment,  would  not  be  borne,  unless  from  persons  believed 
to  be  more  than  men,  and  backed  by  supernatural  terrors. 

The  most  skilfully  combined,  and  with  the  greatest  foresight 
of  objections,  of  all  the  forms  of  Socialism,  is  that  commonly 
known  as  Fourierism.  This  system  does  not  contemplate  the 
abolition  of  private  property,  nor  even  of  inheritance :  on  the 
contrary,  it  avowedly  takes  into  consideration,  as  an  'element 
in  the  distribution  of  the  produce,  capital  as  well  as  labor.  It 
proposes  that  the  operations  of  industry  should  be  carried  ori 
by  associations  of  about  two  thousand  members,  combining 
their  labor  on  a  district  of  about  a  square  league  in  extent,  under 
the  guidance  of  chiefs  selected  by  themselves.  In  the  distri¬ 
bution,  a  certain  minimum  is  first  assigned  for  the  subsistence 
of  every  member  of  the  community,  whether  capable  or  not 
of  labor.  The  remainder  of  the  produce  is  shared  in  certain 
proportions,  to  be  determined  beforehand,  among  the  three 
elements,  Labor,  Capital,  and  Talent.  The  capital  of  the  com¬ 
munity  may  be  owned  in  unequal  shares  by  different  members, 
who  would  in  that  case  receive,  as  in  any  other  joint-stock 
company,  proportional  dividends.  The  claim  of  each  person 
on  the  share  of  the  produce  apportioned  to  talent  is  estimated 
by  the  grade  or  rank  which  the  individual  occupies  in  the  sev¬ 
eral  groups  of  laborers  to  which  he  or  she  belongs ;  these  grades 
being  in  all  cases  conferred  by  the  choice  of  his  or  her  compan¬ 
ions.  The  remuneration,  when  received,  would  not  of  necessity 
be  expended  or  enjoyed  in  common ;  there  would  be  separate 
menages  for  all  who  preferred  them,  and  no  other  community 
of  living  is  contemplated,  than  that  all  the  members  of  the 


PROPERTY 


21  I 


association  should  reside  in  the  same  pile  of  buildings;  for 
saving  of  labor  and  expense,  not  only  in  building,  but  in  every 
branch  of  domestic  economy;  and  in  order  that,  the  whole  of 
the  buying  and  selling  operations  of  the  community  being  per¬ 
formed  by  a  single  agent,  the  enormous  portion  of  the  produce 
of  industry  now  carried  off  by  the  profits  of  mere  distributors 
might  be  reduced  to  the  smallest  amount  possible. 

This  system,  unlike  Communism,  does  not,  in  theory  at  least, 
withdraw  any  of  the  motives  to  exertion  which  exist  in  the 
present  state  of  society.  On  the  contrary,  if  the  arrangement 
worked  according  to  the  intentions  of  its  contrivers,  it  would 
even  strengthen  those  motives ;  since  each  person  would  have 
much  more  certainty  of  reaping  individually  the  fruits  of  in¬ 
creased  skill  or  energy,  bodily  or  mental,  than  under  the  present 
social  arrangements  can  be  felt  by  any  but  those  who  are  in 
the  most  advantageous  positions,  or  to  whom  the  chapter  of 
accidents  is  more  than  ordinarily  favorable.  The  Fourierists, 
however,  have  still  another  resource.  They  believe  that  they 
have  solved  the  great  and  fundamental  problem  of  rendering 
labor  attractive.  That  this  is  not  impracticable,  they  contend  by 
very  strong  arguments ;  in  particular  by  one  which  they  have 
in  common  with  the  Owenites,  viz.,  that  scarcely  any  labor, 
however  severe,  undergone  by  human  beings  for  the  sake  of 
subsistence,  exceeds  in  intensity  that  which  other  human  beings, 
whose  subsistence  is  already  provided  for,  are  found  ready  and 
even  eager  to  undergo  for  pleasure.  This  certainly  is  a  most 
significant  fact,  and  one  from  which  the  student  in  social  phi¬ 
losophy  may  draw  important  instruction.  But  the  argument 
founded  on  it  may  easily  be  stretched  too  far.  If  occupations 
full  of  discomfort  and  fatigue  are  freely  pursued  by  many  per¬ 
sons  as  amusements,  who  does  not  see  that  they  are  amuse¬ 
ments  exactly  because  they  are  pursued  freely,  and  may  be 
discontinued  at  pleasure?  The  liberty  of  quitting  a  position 
often  makes  the  whole  difference  between  its  being  painful  and 
pleasurable.  Many  a  person  remains  in  the  same  town,  street, 
or  house  from  January  to  December,  without  a  wish  or  a 
thought  tending  toward  removal,  who,  if  confined  to  that  same 
place  by  the  mandate  of  authority,  would  find  the  imprisonment 
absolutely  intolerable. 

According  to  the  Fourierists,  scarcely  any  kind  of  useful  labor 
is  naturally  and  necessarily  disagreeable,  unless  it  is  either  re- 


212 


POLITICAL  ECONOMY 


garded  as  dishonorable,  or  is  immoderate  in  degree,  or  destitute 
of  the  stimulus  of  sympathy  and  emulation.  Excessive  toil 
needs  not,  they  contend,  be  undergone  by  anyone,  in  a  society 
in  which  there  would  be  no  idle  class,  and  no  labor  wasted, 
as  so  enormous  an  amount  of  labor  is  now  wasted,  in  useless 
things ;  and  where  full  advantage  would  be  taken  of  the  power 
of  association,  both  in  increasing  the  efficiency  of  production, 
and  in  economizing  consumption.  The  other  requisites  for  ren¬ 
dering  labor  attractive  would,  they  think,  be  found  in  the  exe¬ 
cution  of  all  labor  by  social  groups,  to  any  number  of  which  the 
same  individual  might  simultaneously  belong,  at  his  or  her  own 
choice ;  their  grade  in  each  being  determined  by  the  degree  of 
service  which  they  were  found  capable  of  rendering,  as  appre¬ 
ciated  by  the  suffrages  of  their  comrades.  It  is  inferred  from 
the  diversity  of  tastes  and  talents,  that  every  member  of  the 
community  would  be  attached  to  several  groups,  employing 
themselves  in  various  kinds  of  occupation,  some  bodily,  others 
mental,  and  would  be  capable  of  occupying  a  high  place  in 
some  one  or  more ;  so  that  a  real  equality,  or  something  more 
nearly  approaching  to  it  than  might  at  first  be  supposed,  would 
practically  result:  not  from  the  compression,  but,  on  the  con¬ 
trary,  from  the  largest  possible  development,  of  the  various 
natural  superiorities  residing  in  each  individual. 

Even  from  so  brief  an  outline,  it  must  be  evident  that  this 
system  does  no  violence  to  any  of  the  general  laws  by  which 
human  action,  even  in  the  present  imperfect  state  of  moral  and 
intellectual  cultivation,  is  influenced;  and  that  it  would  be 
extremely  rash  to  pronounce  it  incapable  of  success,  or  unfitted 
to  realize  a  great  part  of  the  hopes  founded  on  it  by  its  partisans. 
With  regard  to  this,  as  to  all  other  varieties  of  Socialism,  the 
thing  to  be  desired,  and  to  which  they  have  a  just  claim,  is 
opportunity  of  trial.  They  are  all  capable  of  being  tried  on 
a  moderate  scale,  and  at  no  risk,  either  personal  or  pecuniary, 
to  any  except  those  who  try  them.  It  is  for  experience  to  de¬ 
termine  how  far  or  how  soon  any  one  or  more  of  the  possible 
systems  of  community  of  property  will  be  fitted  to  substitute 
itself  for  the  “  organization  of  industry  ”  based  on  private  own¬ 
ership  of  land  and  capital.  ( Jn  tjje  meantime  we  may,  without 
attempting  to  limit  the  ultimate  capabilities  of  human  nature, 
^ffTfm^Jthat  the  political  economist,  for  a  considerable  time  to 
come,  will  be  chiefly  concerned  with  the  conditions  of  existence 


PROPERTY 


213 


and  progress  belonging  to  a  society  founded  on  private  property 
and  individual  competition ;  and  that  the  object  to  be  principally 
aimed  at  in  the  present  stage  of  human  improvement,  is  not  the 
subversion  of  the  system  of  individual  property,  but  the  im¬ 
provement  of  it,  and  the  full  participation  of  every  member 
of  the  community  in  its  benefits. 

Chapter  II. — The  Same  Subject  Continued 

§  I.  It  is  next  to  be  considered,  what  is  included  in  the  idea 
of  private  property,  and  by  what  considerations  the  application 
of  the  principle  should  be  bounded. 

The  institution  of  property,  when  limited  to  its  essential  ele¬ 
ments,  consists  in  the  recognition,  in  each  person,  of  a  right  to 
the  exclusive  disposal  of  what  he  or  she  have  produced  by  their 
own  exertions,  or  received  either  by  gift  or  by  fair  agreement, 
without  force  or  fraud,  from  those  who  produced  it.  The  foun¬ 
dation  of  the  whole  is,  the  right  of  producers  to  what  they 
themselves  have  produced.  It  may  be  objected,  therefore,  to 
the  institution  as  it  now  exists,  that  it  recognizes  rights  of  prop¬ 
erty  in  individuals  over  things  which  they  have  not  produced. 
For  example  (it  may  be  said)  the  operatives  in  a  manufactory 
create,  by  their  labor  and  skill,  the  whole  produce  ;  yet,  instead 
of  its  belonging  to  them,  the  law  gives  them  only  their  stipu¬ 
lated  hire,  and  transfers  the  produce  to  some  one  who  has 
merely  supplied  the  funds,  without  perhaps  contributing  any¬ 
thing  to  the  work  itself,  even  in  the  form  of  superintendence. 
The  answer  to  this  is,  that  the  labor  of  manufacture  is  only  one 
of  the  conditions  which  must  combine  for  the  production  of 
the  commodity.  The  labor  cannot  be  carried  on  without  ma¬ 
terials  and  machinery,  nor  without  a  stock  of  necessaries  pro¬ 
vided  in  advance,  to  maintain  the  laborers  during  the  produc¬ 
tion.  All  these  things  are  the  fruits  of  previous  labor.  If  the 
laborers  were  possessed  of  them,  they  would  not  need  to  divide 
the  produce  with  any  one ;  but  while  they  have  them  not,  an 
equivalent  must  be  given  to  those  who  have,  both  for  the 
antecedent  labor,  and  for  the  abstinence  by  which  the  produce 
of  that  labor,  instead  of  being  expended  on  indulgences,  has 
been  reserved  for  this  use.  The  capital  may  not  have  been,  and 
in  most  cases  was  not,  created  by  the  labor  and  abstinence  of 
the  present  possessor ;  but  it  was  created  by  the  labor  and  ab- 


214 


POLITICAL  ECONOMY 


stinence  of  some  former  person,  who  may  indeed  have  been 
wrongfully  dispossessed  of  it,  but  who,  in  the  present  age  of 
the  world,  much  more  probably  transferred  his  claims  to  the 
present  capitalist  by  gift  or  voluntary  contract:  and  the  ab¬ 
stinence  at  least  must  have  been  continued  by  each  successive 
owner,  down  to  the  present.  If  it  be  said,  as  it  may  with  truth, 
that  those  who  have  inherited  the  savings  of  others  have  an 
advantage  which  they  may  have  in  no  way  deserved,  over  the 
industrious  whose  predecessors  have  not  left  them  anything; 
I  not  only  admit,  but  strenuously  contend,  that  this  unearned 
advantage  should  be  curtailed,  as  much  as  is  consistent  with 
justice  to  those  who  thought  fit  to  dispose  of  their  savings  by 
giving  them  to  their  descendants.  But  while  it  is  true  that  the 
laborers  are  at  a  disadvantage  compared  with  those  whose  pred¬ 
ecessors  have  saved,  it  is  also  true  that  the  laborers  are  far 
better  off  than  if  those  predecessors  had  not  saved.  They 
share  in  the  advantage,  though  not  to  an  equal  extent  with  the 
inheritors.  The  terms  of  co-operation  between  present  labor 
and  the  fruits  of  past  labor  and  saving,  are  subject  for  adjust¬ 
ment  between  the  two  parties.  Each  is  necesssary  to  the  other. 
The  capitalists  can  do  nothing  without  laborers,  nor  the  la¬ 
borers  without  capital.  If  the  laborers  compete  for  employ¬ 
ment,  the  capitalists  on  their  part  compete  for  labor,  to  the  full 
extent  of  the  circulating  capital  of  the  country.  Competition 
is  often  spoken  of  as  if  it  were  necessarily  a  cause  of  misery 
and  degradation  to  the  laboring  class ;  as  if  high  wages  were 
not  precisely  as  much  a  product  of  competition  as  low  wages. 
The  remuneration  of  labor  is  as  much  the  result  of  the  law  of 
competition  in  the  United  States,  as  it  is  in  Ireland,  and  much 
more  completely  so  than  in  England. 

The  right  of  property  includes,  then,  the  freedom  of  acquir¬ 
ing  by  contract.  The  right  of  each  to  what  he  has  produced, 
implies  a  right  to  what  has  been  produced  by  others,  if  ob¬ 
tained  by  their  free  consent ;  since  the  producers  must  either 
have  given  it  from  good  will,  or  exchanged  it  for  what  they  es¬ 
teemed  an  equivalent,  and  to  prevent  them  from  doing  so  would 
be  to  infringe  their  right  of  property  in  the  product  of  their 
own  industry. 

§  2.  Before  proceeding  to  consider  the  things  which  the 
principle  of  individual  property  does  not  include,  we  must 
specify  one  more  thing  which  it  does  include :  and  this  is,  that 


PROPERTY 


215 


a  title,  after  a  certain  period,  should  be  given  by  prescription. 
According  to  the  fundamental  idea  of  property,  indeed,  noth¬ 
ing  ought  to  be  treated  as  such,  which  has  been  acquired  by 
force  or  fraud,  or  appropriated  in  ignorance  of  a  prior  title 
vested  in  some  other  person ;  but  it  is  necessary  to  the  security 
of  rightful  possessors,  that  they  should  not  be  molested  by 
charges  of  wrongful  acquisition,  when  by  the  lapse  of  time 
witnesses  must  have  perished  or  been  lost  sight  of,  and  the  real 
character  of  the  transaction  can  no  longer  be  cleared  up.  Pos¬ 
session  which  has  not  been  legally  questioned  within  a  moder¬ 
ate  number  of  years,  ought  to  be,  as  by  the  laws  of  all  nations 
it  is,  a  complete  title.  Even  when  the  acquisition  was  wrong¬ 
ful,  the  dispossession,  after  a  generation  has  elapsed,  of  the 
probably  bond  fide  possessors,  by  the  revival  of  a  claim  which 
had  been  long  dormant,  would  generally  be  a  greater  injustice, 
and  almost  always  a  greater  private  and  public  mischief,  than 
leaving  the  original  wrong  without  atonement.  It  may  seem 
hard,  that  a  claim,  originally  just,  should  be  defeated  by  mere 
lapse  of  time ;  but  there  is  a  time  after  which,  (even  looking  at 
the  individual  case,  and  without  regard  to  the  general  effect  on 
the  security  of  possessors,)  the  balance  of  hardship  turns  the 
other  way.  With  the  injustices  of  men,  as  with  the  convulsions 
and  disasters  of  nature,  the  longer  they  remain  unrepaired,  the 
greater  become  the  obstacles  to  repairing  them,  arising  from 
the  aftergrowths  which  would  have  to  be  torn  up  or  broken 
through.  In  no  human  transactions,  not  even  in  the  simplest 
and  clearest,  does  it  follow  that  a  thing  is  fit  to  be  done  now, 
because  it  was  fit  to  be  done  sixty  years  ago.  It  is  scarcely 
needful  to  remark,  that  these  reasons  for  not  disturbing  acts  of 
injustice  of  old  date,  cannot  apply  to  unjust  systems  or  insti¬ 
tutions  ;  since  a  bad  law  or  usage  is  not  one  bad  act,  in  the  re¬ 
mote  past,  but  a  perpetual  repetition  of  bad  acts,  as  long  as 
the  law  or  usage  lasts. 

Such,  then,  being  the  essentials  of  private  property,,  it  is  now 
to  be  considered,  to  what  extent  the  forms  in  which  the  insti¬ 
tution  has  existed  in  different  states  of  society,  or  still  exists, 
are  necessary  consequences  of  its  principle,  or  are  recom¬ 
mended  by  the  reasons  on  which  it  is  grounded. 

§  3.  Nothing  is  implied  in  property  but  the  right  of  each  to 
his  (or  her)  own  faculties,  to  what  he  can  produce  by  them,  and 
to  whatever  he  can  get  for  them  in  a  fair  market :  together  with 


2l6 


POLITICAL  ECONOMY 


his  right  to  give  this  to  any  other  person  if  he  chooses,  and  the 
right  of  that  other  to  receive  and  enjoy  it. 

It  follows,  therefore,  that  although  the  right  of  bequest,  or 
gift  after  death,  forms  part  of  the  idea  of  private  property,  the 
right  of  inheritance,  as  distinguished  from  bequest,  does  not. 
That  the  property  of  persons  who  have  made  no  disposition  of 
it  during  their  lifetime,  should  pass  first  to  their  children,  and 
failing  them,  to  the  nearest  relations,  may  be  a  proper  ar¬ 
rangement  or  not,  but  is  no  consequence  of  the  principle  of 
private  property.  Although  there  belong  to  the  decision  of 
such  questions  many  considerations  besides  those  of  political 
economy,  it  is  not  foreign  to  the  plan  of  this  work  to  suggest, 
for  the  judgment  of  thinkers,  the  view  of  them  which  most 
recommends  itself  to  the  writer’s  mind. 

No  presumption  in  favor  of  existing  ideas  on  this  subject  is 
to  be  derived  from  their  antiquity.  In  early  ages,  the  property 
of  a  deceased  person  passed  to  his  children  and  nearest  rela¬ 
tives  by  so  natural  and  obvious  an  arrangement,  that  no  other 
was  likely  to  be  even  thought  of  in  competition  with  it.  In 
the  first  place,  they  were  usually  present  on  the  spot :  they  were 
in  possession,  and  if  they  had  no  other  title,  had  that,  so  im¬ 
portant  in  an  early  state  of  society,  of  first  occupancy.  Second¬ 
ly,  they  were  already,  in  a  manner,  joint  owners  of  his  property 
during  his  life.  If  the  property  was  in  land,  it  had  generally 
been  conferred  by  the  State  on  a  family  rather  than  on  an  in¬ 
dividual  :  if  it  consisted  of  cattle  or  movable  goods,  it  had 
probably  been  acquired,  and  was  certainly  protected  and  de¬ 
fended,  by  the  united  efforts  of  all  members  of  the  family  who 
were  of  an  age  to  work  or  fight.  Exclusive  individual  prop¬ 
erty,  in  the  modern  sense,  scarcely  entered  into  the  ideas  of 
the  time  ;  and  when  the  first  magistrate  of  the  association  died, 
he  really  left  nothing  vacant  but  his  own  share  in  the  division, 
which  devolved  on  the  member  of  the  family  who  succeeded  to 
his  authority.  To  have  disposed  of  the  property  otherwise, 
would  have  been  to  break  up  a  little  commonwealth,  united  by 
ideas,  interest,  and  habits,  and  to  cast  them  adrift  on  the  world. 
These  considerations,  though  rather  felt  than  reasoned  about, 
had  so  great  an  influence  on  the  minds  of  mankind,  as  to  create 
the  idea  of  an  inherent  right  in  the  children  to  the  possessions 
of  their  ancestor ;  a  right  which  it  was  not  competent  to  himself 
to  defeat.  Bequest,  in  a  primitive  state  of  society,  was  seldom 


PROPERTY 


217 


recognized ;  a  clear  proof,  were  there  no  other,  that  property 
was  conceived  in  a  manner  totally  different  from  the  conception 
of  it  in  the  present  time.* 

But  the  feudal  family,  the  last  historical  form  of  patriarchal 
life,  has  long  perished,  and  the  unit  of  society  is  not  now  the 
family  or  clan,  composed  of  all  the  reputed  descendants  of  a 
common  ancestor,  but  the  individual ;  or  at  most  a  pair  of  in¬ 
dividuals,  with  their  unemancipated  children.  Property  is  now 
inherent  in  individuals,  not  in  families :  the  children  when 
grown  up  do  not  follow  the  occupations  or  fortunes  of  the 
parent :  if  they  participate  in  the  parent’s  pecuniary  means  it 
is  at  his  or  her  pleasure,  and  not  by  a  voice  in  the  ownership 
and  government  of  the  whole,  but  generally  by  the  exclusive 
enjoyment  of  a  part:  and  in  this  country  at  least  (except  as  far 
as  entails  or  settlements  are  an  obstacle)  it  is  in  the  power  of 
parents  to  disinherit  even  their  children,  and  leave  their 
fortune  to  strangers.  More  distant  relatives  are  in  general 
almost  as  completely  detached  from  the  family  and  its  inter¬ 
ests  as  if  they  were  in  no  way  connected  with  it.  The  only 
claim  they  are  supposed  to  have  on  their  richer  relations,  is  to 
a  preference,  cceteris  paribus,  in  good  offices,  and  some  aid  in 
case  of  actual  necessity. 

So  great  a  change  in  the  constitution  of  society  must  make 
a  considerable  difference  in  the  grounds  on  which  the  disposal 
of  property  by  inheritance  should  rest.  The  reasons  usually 
assigned  by  modern  writers  for  giving  the  property  of  a  per¬ 
son  who  dies  intestate,  to  the  children,  or  nearest  relatives, 
are  first,  the  supposition  that  in  so  disposing  of  it,  the  law  is 
more  likely  than  in  any  other  mode  to  do  what  the  proprietor 
would  have  done,  if  he  had  done  anything;  and  secondly,  the 
hardship,  to  those  who  lived  with  their  parents  and  partook 
in  their  opulence,  of  being  cast  down  from  the  enjoyments  of 
wealth  into  poverty  and  privation. 

There  is  some  force  in  both  these  arguments.  The  law 
ought,  no  doubt,  to  do  for  the  children  or  dependents  of  an 
intestate,  whatever  it  was  the  duty  of  the  parent  or  protector 
to  have  done,  so  far  as  this  can  be  known  by  anyone  besides 
himself.  Since,  however,  the  law  cannot  decide  on  individual 
claims,  but  must  proceed  by  general  rules,  it  is  next  to  be  con¬ 
sidered  what  these  rules  should  be. 

*  See,  for  admirable  illustrations  of  Maine’s  profound  work  on  “  Ancient 
this  and  many  kindred  points,  Mr.  Law  and  its  relation  to  Modern  Ideas.” 


2  1 8 


POLITICAL  ECONOMY 


We  may  first  remark,  that  in  regard  to  collateral  relatives, 
it  is  not,  unless  on  grounds  personal  to  the  particular  indi¬ 
vidual,  the  duty  of  any  one  to  make  a  pecuniary  provision  for 
them.  No  one  now  expects  it,  unless  there  happens  to  be  no 
direct  heirs ;  nor  would  it  be  expected  even  then,  if  the  expec¬ 
tation  were  not  created  by  the  provisions  of  the  law  in  case  of 
intestacy.  I  see,  therefore,  no  reason  why  collateral  inheritance 
should  exist  at  all.  Mr.  Bentham  long  ago  proposed,  and 
other  high  authorities  have  agreed  in  the  opinion,  that  if  there 
are  no  heirs  either  in  the  descending  or  in  the  ascending  line, 
the  property,  in  case  of  intestacy,  should  escheat  to  the  State. 
With  respect  to  the  more  remote  degrees  of  collateral  relation¬ 
ship,  the  point  is  not  very  likely  to  be  disputed.  Few  will  main¬ 
tain  that  there  is  any  good  reason  why  the  accumulations  of 
some  childless  miser  should  on  his  death  (as  every  now  and 
then  happens)  go  to  enrich  a  distant  relative  who  never  saw 
him,  who  perhaps  never  knew  himself  to  be  related  to  him 
until  there  was  something  to  be  gained  by  it,  and  who  had  no 
moral  claim  upon  him  of  any  kind,  more  than  the  most  entire 
stranger.  But  the  reason  of  the  case  applies  alike  to  all  col¬ 
laterals,  even  in  the  nearest  degree.  Collaterals  have  no  real 
claims,  but  such  as  may  be  equally  strong  in  the  case  of  non¬ 
relatives  ;  and  in  the  one  case  as  in  the  other,  where  valid 
claims  exist,  the  proper  mode  of  paying  regard  to  them  is  by 
bequest. 

The  claims  of  children  are  of  a  different  nature :  they  are 
real,  and  indefeasible.  But  even  of  these,  I  venture  to  think 
that  the  measure  usually  taken  is  an  erroneous  one :  what  is 
due  to  children  is  in  some  respects  underrated,  in  others,  as  it 
appears  to  me,  exaggerated.  One  of  the  most  binding  of  all 
obligations,  that  of  not  bringing  children  into  the  world  unless 
they  can  be  maintained  in  comfort  during  childhood,  and 
brought  up  with  a  likelihood  of  supporting  themselves  when  of 
full  age,  is  both  disregarded  in  practice  and  made  light  of  in 
theory  in  a  manner  disgraceful  to  human  intelligence.  On  the 
other  hand,  when  the  parent  possesses  property,  the  claims  of 
the  children  upon  it  seem  to  me  to  be  the  subject  of  an  opposite 
error.  Whatever  fortune  a  parent  may  have  inherited,  or  still 
more,  may  have  acquired,  I  cannot  admit  that  he  owes  to  his 
children,  merely  because  they  are  his  children,  to  leave  them 
rich,  without  the  necessity  of  any  exertion.  I  could  not  ad- 


PROPERTY 


219 

mit  it,  even  if  to  be  so  left  were  always,  and  certainly,  for  the 
good  of  the  children  themselves.  But  this  is  in  the  highest 
degree  uncertain.  It  depends  on  individual  character.  With¬ 
out  supposing  extreme  cases,  it  may  be  affirmed  that  in  a  ma¬ 
jority  of  instances  the  good  not  only  of  society  but  of  the  indi¬ 
viduals  would  be  better  consulted  by  bequeathing  to  them  a 
moderate  than  a  large  provision.  This,  which  is  a  common¬ 
place  of  moralists  ancient  and  modern,  is  felt  to  be  true  by 
many  intelligent  parents,  and  would  be  acted  upon  much  more 
frequently,  if  they  did  not  allow  themselves  to  consider  less 
what  really  is,  than  what  will  be  thought  by  others  to  be,  ad¬ 
vantageous  to  the  children. 

The  duties  of  parents  to  their  children  are  those  which  are 
indissolubly  attached  to  the  fact  of  causing  the  existence  of  a 
human  being.  The  parent  owes  to  society  to  endeavor  to 
make  the  child  a  good  and  valuable  member  of  it,  and  owes  to 
the  children  to  provide,  so  far  as  depends  on  him,  such  edu¬ 
cation,  and  such  appliances  and  means,  as  will  enable  them  to 
start  with  a  fair  chance  of  achieving  by  their  own  exertions 
a  successful  life.  To  this  every  child  has  a  claim ;  and  I  can¬ 
not  admit,  that  as  a  child  he  has  a  claim  to  more.  There  is  a 
case  in  which  these  obligations  present  themselves  in  their 
true  light,  without  any  extrinsic  circumstances  to  disguise  or 
confuse  them :  it  is  that  of  an  illegitimate  child.  To  such  a 
child  it  is  generally  felt  that  there  is  due  from  the  parent,  the 
amount  of  provision  for  his  welfare  which  will  enable  him  to 
make  his  life  on  the  whole  a  desirable  one.  I  hold  that  to  no 
child,  merely  as  such,  anything  more  is  due,  than  what  is  ad¬ 
mitted  to  be  due  to  an  illegitimate  child :  and  that  no  child 
for  whom  thus  much  has  been  done,  has,  unless  on  the  score  of 
previously  raised  expectations,  any  grievance,  if  the  remainder 
of  the  parent’s  fortune  is  devoted  to  public  uses,  or  to  the  bene¬ 
fit  of  individuals  on  whom  in  the  parent’s  opinion  it  is  better 
bestowed. 

In  order  to  give  the  children  that  fair  chance  of  a  desirable 
existence,  to  which  they  are  entitled,  it  is  generally  necessary 
that  they  should  not  be  brought  up  from  childhood  in  habits 
of  luxury  which  they  will  not  have  the  means  of  indulging  in 
after  life.  This,  again,  is  a  duty  often  flagrantly  violated  by 
possessors  of  terminable  incomes,  who  have  little  property  to 
leave.  When  the  children  of  rich  parents  have  lived,  as  it  is 


220 


POLITICAL  ECONOMY 


natural  they  should  do,  in  habits  corresponding  to  the  scale  of 
expenditure  in  which  the  parents  indulge,  it  is  generally  the 
duty  of  the  parents  to  make  a  greater  provision  for  them,  than 
would  suffice  for  children  otherwise  brought  up.  I  say  gen¬ 
erally,  because  even  here  there  is  another  side  to  the  question. 
It  is  a  proposition  quite  capable  of  being  maintained,  that  to  a 
strong  nature  which  has  to  make  its  way  against  narrow  cir¬ 
cumstances,  to  have  known  early  some  of  the  feelings  and 
experiences  of  wealth,  is  an  advantage  both  in  the  formation 
of  character  and  in  the  happiness  of  life.  But  allowing  that 
children  have  a  just  ground  of  complaint,  who  have  been 
brought  up  to  require  luxuries  which  they  are  not  afterwards 
likely  to  obtain,  and  that  their  claim,  therefore,  is  good  to  a 
provision  bearing  some  relation  to  the  mode  of  their  bringing 
up ;  this,  too,  is  a  claim  which  is  particularly  liable  to  be 
stretched  further  than  its  reasons  warrant.  The  case  is  ex¬ 
actly  that  of  the  younger  children  of  the  nobility  and  landed 
gentry,  the  bulk  of  whose  fortune  passes  to  the  eldest  son. 
The  other  sons,  who  are  usually  numerous,  are  brought  up  in 
the  same  habits  of  luxury  as  the  future  heir,  and  they  receive,  as 
a  younger  brother’s  portion,  generally  what  the  reason  of  the 
case  dictates,  namely,  enough  to  support,  in  the  habits  of  life 
to  which  they  are  accustomed,  themselves,  but  not  a  wife  or 
children.  It  really  is  no  grievance  to  any  man,  that  for  the 
means  of  marrying  and  of  supporting  a  family,  he  has  to  de¬ 
pend  on  his  own  exertions. 

A  provision,  then,  such  as  is  admitted  to  be  reasonable  in 
the  case  of  illegitimate  children,  of  younger  children,  wherever 
in  short  the  justice  of  the  case,  and  the  real  interests  of  the  in¬ 
dividuals  and  of  society,  are  the  only  things  considered,  is,  I 
conceive,  all  that  parents  owe  to  their  children,  and  all,  there¬ 
fore,  which  the  state  owes  to  the  children  of  those  who  die  in¬ 
testate.  The  surplus,  if  any,  I  hold  that  it  may  rightfully  ap¬ 
propriate  to  the  general  purposes  of  the  community.  I  would 
not,  however,  be  supposed  to  recommend  that  parents  should 
never  do  more  for  their  children  than  what,  merely  as  children, 
they  have  a  moral  right  to.  In  some  cases  it  is  imperative,  in 
many  laudable,  and  in  all  allowable,  to  do  much  more.  For 
this,  however,  the  means  are  afforded  by  the  liberty  of  bequest. 
It  is  due,  not  to  the  children  but  to  the  parents,  that  they  should 
have  the  power  of  showing  marks  of  affection,  of  requiting 


PROPERTY 


221 


services  and  sacrifices,  and  of  bestowing  their  wealth  according 
to  their  own  preferences,  or  their  own  judgment  of  fitness. 

§  4.  Whether  the  power  of  bequest  should  itself  be  subject 
to  limitation,  is  an  ulterior  question  of  great  importance.  Un¬ 
like  inheritance  ab  intestato,  bequest  is  one  of  the  attributes  of 
property :  the  ownership  of  a  thing  cannot  be  looked  upon  as 
complete  without  the  power  of  bestowing  it,  at  death  or  dur¬ 
ing  life,  at  the  owner’s  pleasure:  and  all  the  reasons,  which 
recommend  that  private  property  should  exist,  recommend  pro 
tanto  this  extension  of  it.  But  property  is  only  a  means  to  an 
end,  not  itself  the  end.  Like  all  other  proprietary  rights,  and 
even  in  a  greater  degree  than  most,  the  power  of  bequest  may 
be  so  exercised  as  to  conflict  with  the  permanent  interests  of 
the  human  race.  It  does  so,  when,  not  content  with  bequeath¬ 
ing  an  estate  to  A,  the  testator  prescribes  that  on  A’s  death  it 
shall  pass  to  his  eldest  son,  and  to  that  son’s  son,  and  so  on 
forever.  No  doubt,  persons  have  occasionally  exerted  them¬ 
selves  more  strenuously  to  acquire  a  fortune  from  the  hope  of 
founding  a  family  in  perpetuity;  but  the  mischiefs  to  society 
of  such  perpetuities  outweigh  the  value  of  this  incentive  to  ex¬ 
ertion,  and  the  incentives  in  the  case  of  those  who  have  the 
opportunity  of  making  large  fortunes  are  strong  enough  with¬ 
out  it.  A  similar  abuse  of  the  power  of  bequest  is  committed 
when  a  person  who  does  the  meritorious  act  of  leaving  property 
for  public  uses,  attempts  to  prescribe  the  details  of  its  applica¬ 
tion  in  perpetuity ;  when  in  founding  a  place  of  education, 
(for  instance)  he  dictates,  forever,  what  doctrines  shall  be 
taught.  It  being  impossible  that  any  one  should  know  what 
doctrines  will  be  fit  to  be  taught  after  he  has  been  dead  for 
centuries,  the  law  ought  not  to  give  effect  to  such  dispositions 
of  property,  unless  subject  to  the  perpetual  revision  (after  a 
certain  interval  has  elapsed)  of  a  fitting  authority. 

These  are  obvious  limitations.  But  even  the  simplest  exer¬ 
cise  of  the  right  of  bequest,  that  of  determining  the  person  to 
whom  property  shall  pass  immediately  on  the  death  of  the 
testator,  has  always  been  reckoned  among  the  privileges  which 
might  be  limited  or  varied,  according  to  views  of  expediency. 
The  limitations,  hitherto,  have  been  almost  solely  in  favor  of 
children.  In  England  the  right  is  in  principle  unlimited,  al¬ 
most  the  only  impediment  being  that  arising  from  a  settlement 
by  a  former  proprietor,  in  which  case  the  holder  for  the  time 


222 


POLITICAL  ECONOMY 


being  cannot  indeed  bequeath  his  possessions,  but  only  be¬ 
cause  there  is  nothing  to  bequeath,  he  having  merely  a  life 
interest.  By  the  Roman  law  on  which  the  civil  legislation  of 
the  Continent  of  Europe  is  principally  founded,  bequest  origi¬ 
nally  was  not  permitted  at  all,  and  even  after  it  was  introduced, 
a  legitima  portio  was  compulsorily  reserved  for  each  child ;  and 
such  is  still  the  law  in  some  of  the  Continental  nations.  By  the 
French  law  since  the  Revolution,  the  parent  can  only  dispose 
by  will,  of  a  portion  equal  to  the  share  of  one  child,  each  of 
the  children  taking  an  equal  portion.  This  entail,  as  it  may  be 
called,  of  the  bulk  of  every  one’s  property  upon  the  children 
collectively,  seems  to  me  as  little  defensible  in  principle  as  an 
entail  in  favor  of  one  child,  though  it  does  not  shock  so  di¬ 
rectly  the  idea  of  justice.  I  cannot  admit  that  parents  should 
be  compelled  to  leave  to  their  children  even  that  provision 
which,  as  children,  I  have  contended  that  they  have  a  moral 
claim  to.  Children  may  forfeit  that  claim  by  general  unworthi¬ 
ness,  or  particular  ill-conduct  to  the  parents :  they  may  have 
other  resources  or  prospects :  what  has  been  previously  done 
for  them,  in  the  way  of  education  and  advancement  in  life,  may 
fully  satisfy  their  moral  claim ;  or  others  may  have  claims 
superior  to  theirs. 

The  extreme  restriction  of  the  power  of  bequest  in  French 
law  was  adopted  as  a  democratic  expedient,  to  break  down  the 
custom  of  primogeniture,  and  counteract  the  tendency  of  in¬ 
herited  property  to  collect  in  large  masses.  I  agree  in  thinking 
these  objects  eminently  desirable;  but  the  means  used  are  not, 
I  think,  the  most  judicious.  Were  I  framing  a  code  of  laws 
according  to  what  seems  to  me  best  in  itself,  without  regard 
to  existing  opinions  and  sentiments,  I  should  prefer  to  restrict, 
not  what  any  one  might  bequeath,  but  what  any  one  should  be 
permitted  to  acquire,  by  bequest  or  inheritance.  Each  person 
should  have  power  to  dispose  by  will  of  his  or  her  whole  prop¬ 
erty  ;  but  not  to  lavish  it  in  enriching  some  one  individual, 
beyond  a  certain  maximum,  which  should  be  fixed  sufficiently 
high  to  afford  the  means  of  comfortable  independence.  The 
inequalities  of  property  which  arise  from  unequal  industry,  fru¬ 
gality,  perseverance,  talents,  and  to  a  certain  extent  even  op¬ 
portunities,  are  inseparable  from  the  principle  of  private  prop¬ 
erty,  and  if  we  accept  the  principle,  we  must  bear  with  these 
consequences  of  it:  but  I  see  nothing  objectionable  in  fixing 


PROPERTY 


223 


a  limit  to  what  any  one  may  acquire  by  the  mere  favor  of  others, 
without  any  exercise  of  his  faculties,  and  in  requiring  that  if 
he  desires  any  further  accession  of  fortune,  he  shall  work  for 
it.*  I  do  not  conceive  that  the  degree  of  limitation  which  this 
would  impose  on  the  right  of  bequest,  would  be  felt  as  a  bur¬ 
densome  restraint  by  any  testator  who  estimated  a  large  fortune 
at  its  true  value,  that  of  the  pleasures  and  advantages  that  can 
be  purchased  with  it :  on  even  the  most  extravagant  estimate 
of  which,  it  must  be  apparent  to  every  one,  that  the  difference 
to  the  happiness  of  the  possessor  between  a  moderate  inde¬ 
pendence  and  five  times  as  much,  is  insignificant  when  weighed 
against  the  enjoyment  that  might  be  given,  and  the  perma¬ 
nent  benefits  diffused,  by  some  other  disposal  of  the  four-fifths. 
So  long  indeed  as  the  opinion  practically  prevails,  that  the  best 
thing  which  can  be  done  for  objects  of  affection  is  to  heap  on 
them  to  satiety  those  intrinsically  worthless  things  on  which 
large  fortunes  are  mostly  expended,  there  might  be  little  use 
in  enacting  such  a  law,  even  if  it  were  possible  to  get  it  passed, 
since  if  there  were  the  inclination,  there  would  generally  be 
the  power  of  evading  it.  The  law  would  be  unavailing  unless 
the  popular  sentiment  went  energetically  along  with  it ;  which 
(judging  from  the  tenacious  adherence  of  public  opinion  in 
France  to  the  law  of  compulsory  division)  it  would  in  some 
states  of  society  and  government  be  very  likely  to  do,  how¬ 
ever  much  the  contrary  may  be  the  fact  in  England  and  at 
the  present  time.  If  the  restriction  could  be  made  practically 
effectual,  the  benefit  would  be  great.  Wealth  which  could  no 
longer  be  employed  in  over-enriching  a  few,  would  either  be 
devoted  to  objects  of  public  usefulness,  or  if  bestowed  on  indi¬ 
viduals,  would  be  distributed  among  a  larger  number.  While 
those  enormous  fortunes  which  no  one  needs  for  any  personal 
purpose  but  ostentation  or  improper  power,  would  become 
much  less  numerous,  there  would  be  a  great  multiplication  of 
persons  in  easy  circumstances,  with  the  advantages  of  leisure, 


*  In  the  case  of  capital  employed  in 
the  hands  of  the  owner  himself,  in  car¬ 
rying  on  any  of  the  operations  of  in¬ 
dustry,  there  are  strong  grounds  for 
leaving  to  him  the  power  of  bequeathing 
to  one  person  the  whole  of  the  funds 
actually  engaged  in  a  single  enterprise. 
It  is  well  that  he  should  be  enabled  to 
leave  the  enterprise  under  the  control  of 
whichever  of  his  heirs  he  regards  as  best 
fitted  to  conduct  it  virtuously  and  effi¬ 
ciently;  and  the  necessity  (very  frequent 


and  inconvenient  under  the  French  law) 
would  be  obviated,  of  breaking  up  a 
manufacturing  or  commercial  establish¬ 
ment  at  the  death  of  its  chief.  In  like 
manner  it  should  be  allowed  to  a  pro¬ 
prietor  who  leaves  to  one  of  his  suc¬ 
cessors  the  moral  burden  of  keeping 
up  an  ancestral  mansion  and  park  or 
pleasure-ground,  to  bestow  along  with 
them  as  much  other  property  as  is  re¬ 
quired  for  their  sufficient  maintenance. 


224 


POLITICAL  ECONOMY 


and  all  the  real  enjoyments  which  wealth  can  give,  except  those 
of  vanity ;  a  class  by  whom  the  services  which  a  nation  having 
leisured  classes  is  entitled  to  expect  from  them,  either  by  their 
direct  exertions  or  by  the  tone  they  give  to  the  feelings  and 
tastes  of  the  public,  would  be  rendered  in  a  much  more  bene¬ 
ficial  manner  than  at  present.  A  large  portion  also  of  the  ac¬ 
cumulations  of  successful  industry  would  probably  be  devoted 
to  public  uses,  either  by  direct  bequests  to  the  State,  or  by  the 
endowment  of  institutions ;  as  is  already  done  very  largely  in 
the  United  States,  where  the  ideas  and  practice  in  the  matter 
of  inheritance  seem  to  be  usually  rational  and  beneficial.* 

§  5.  The  next  point  to  be  considered  is,  whether  the  reasons 
on  which  the  institution  of  property  rests,  are  applicable  to  all 
things  in  which  a  right  of  exclusive  ownership  is  at  present 
recognized ;  and  if  not,  on  what  other  grounds  the  recognition 
is  defensible. 

The  essential  principle  of  property  being  to  assure  to  all  per¬ 
sons  what  they  have  produced  by  their  labor  and  accumulated 
by  their  abstinence,  this  principle  cannot  apply  to  what  is  not 
the  produce  of  labor,  the  raw  material  of  the  earth.  If  the  land 
derived  its  productive  power  wholly  from  nature,  and  not  at  all 
from  industry,  or  if  there  were  any  means  of  discriminating 
what  is  derived  from  each  source,  it  not  only  would  not  be 
necessary,  but  it  would  be  the  height  of  injustice,  to  let  the  gift 
of  nature  be  engrossed  by  individuals.  The  use  of  the  land  in 
agriculture  must  indeed,  for  the  time  being,  be  of  necessity 
exclusive ;  the  same  person  who  has  ploughed  and  sown  must 
be  permitted  to  reap :  but  the  land  might  be  occupied  for  one 
season  only,  as  among  the  ancient  Germans ;  or  might  be 
periodically  redivided  as  population  increased :  or  the  State 


*  “  Munificent  bequests  and  donations 
for  public  purposes,  whether  charitable 
or  educational,  form  a  striking  feature 
in  the  modern  history  of  the  United 
States,  and  especially  of  New  England. 
Not  only  is  it  common  for  rich  capital¬ 
ists  to  leave  by  will  a  portion  of  their 
fortune  towards  the  endowment  of  na¬ 
tional  institutions,  but  individuals  dur¬ 
ing  their  lifetime  make  magnificent 
grants  of  money  for  the  same  objects. 
There  is  here  no  compulsory  law  for  the 
equal  partition  of  property  among  chil¬ 
dren,  as  in  France,  and  on  the  other 
hand,  no  custom  of  entail  or  primogeni¬ 
ture,  as  in  England,  so  that  the  affluent 
feel  themselves  at  liberty  to  share  their 
wealth  between  their  kindred  and  the 
public;  it  being  impossible  to  found  a 
family,  and  parents  having  frequently 


the  happiness  of  seeing  all  their  chil¬ 
dren  well  provided  for  and  independent 
long  before  their  death.  I  have  seen  a 
list  of  bequests  and  donations  made  dur¬ 
ing  the  last  thirty  years  for  the  benefit 
of  religious,  charitable,  and  literary  in¬ 
stitutions  in  the  State  of  Massachusetts 
alone,  and  they  amounted  to  no  less  a 
sum  than  six  millions  of  dollars,  or  more 
than  a  million  sterling.” — Lyell’s  “  Trav¬ 
els  in  America,”  vol.  i.  p.  263. 

In  England,  whoever  leaves  anything, 
beyond  trifling  legacies,  for  public  or 
beneficent  objects,  when  he  has  any  near 
relatives  living,  does  so  at  the  risk  of 
being  declared  insane  by  a  jury  after 
his  death,  or  at  the  least,  of  having  the 
property  wasted  in  a  Chancery  suit  to 
set  aside  the  will. 


PROPERTY 


225 


might  be  the  universal  landlord*  and  the  cultivators  tenants 
under  it,  either  on  lease  or  at  will. 

But  though  land  is  not  the  produce  of  industry,  most  of  its 
valuable  qualities  are  so.  Labor  is  not  only  requisite  for  using, 
but  almost  equally  so  for  fashioning  the  instrument.  Consid¬ 
erable  labor  is  often  required  at  the  commencement,  to  clear 
the  land  for  cultivation.  In  many  cases,  even  when  cleared,  its 
productiveness  is  wholly  the  effect  of  labor  and  art.  The  Bed¬ 
ford  Level  produced  little  or  nothing  until  artifically  drained. 
The  bogs  of  Ireland,  until  the  same  thing  is  done  to  them,  can 
produce  little  besides  fuel.  One  of  the  barrenest  soils  in  the 
world,  composed  of  the  material  of  the  Goodwin  Sands,  the 
Pays  de  Waes  in  Flanders,  has  been  so  fertilized  by  industry, 
as  to  have  become  one  of  the  most  productive  in  Europe.  Cul¬ 
tivation  also  requires  buildings  and  fences,  which  are  wholly 
the  produce  of  labor.  The  fruits  of  this  industry  cannot  be 
reaped  in  a  short  period.  The  labor  and  outlay  are  immediate, 
the  benefit  is  spread  over  many  years,  perhaps  over  all  future 
time.  A  holder  will  not  incur  this  labor  and  outlay  when 
strangers  and  not  himself  will  be  benefited  by  it.  If  he  under¬ 
takes  such  improvements,  he  must  have  a  sufficient  period  be¬ 
fore  him  in  which  to  profit  by  them ;  and  he  is  in  no  way  so 
sure  of  having  always  a  sufficient  period  as  when  his  tenure  is 
perpetual.* 

§  6.  These  are  the  reasons  which  form  the  justification,  in 
an  economical  point  of  view,  of  property  in  land.  It  is  seen  that 


*  “  What  endowed  man  with  intelli¬ 
gence  and  perseverance  in  labor,  what 
made  him  direct  all  his  efforts  towards 
an  end  useful  to  his  race,  was  the  senti¬ 
ment  of  perpetuity.  The  lands  which 
the  streams  nave  deposited  along  their 
course  are  always  the  most  fertile,  but 
are  also  those  which  they  menace  with 
their  inundations  or  corrupt  by  marshes. 
Under  the  guarantee  of  perpetuity  men 
undertook  long  and  painful  labors  to 
give  the  marshes  an  outlet,  to  erect  em¬ 
bankments  against  inundations,  to  dis¬ 
tribute  by  irrigation-channels  fertilizing 
waters  over  the  same  fields  which  the 
same  waters  had  condemned  to  sterility. 
Under  the  same  guarantee,  man,  no 
longer  contenting  himself  with  the  an¬ 
nual  products  of  the  earth,  distin¬ 
guished  among  the  wild  vegetation  the 
perennial  plants,  shrubs,  and  trees 
which  would  be  useful  to  him,  improved 
them  by  culture,  changed,  it  may  al¬ 
most  be  said,  their  very  nature,  and 
multiplied  their  amount.  There  are 
fruits  which  it  required  centuries  of 
cultivation  to  bring  to  their  present  per¬ 


fection,  and  others  which  have  been  in¬ 
troduced  from  the  most  remote  regions. 
Men  have  opened  the  earth  to  a  great 
depth  to  renew  the  soil,  and  fertilize 
it  by  the  mixture  of  its  parts  and  by 
contact  with  the  air;  they  have  fixed 
on  the  hillsides  the  soil  which  would 
have  slid  off,  and  have  covered  the  face 
of  the  country  with  a  vegetation  every¬ 
where  abundant,  and  everywhere  useful 
to  the  human  race.  Among  their  labors 
there  are  some  of  which  the  fruits  can 
only  be  reaped  at  the  end  of  ten  or  of 
twenty  years;  there  are  others  by  which 
their  posterity  will  still  benefit  after  sev¬ 
eral  centuries.  All  have  concurred  in 
augmenting  the  productive  force  of  na¬ 
ture,  in  giving  to  mankind  a  revenue 
infinitely  more  abundant,  a  revenue  of 
which  a  considerable  part  is  consumed 
by  those  who  have  no  share  in  the  own¬ 
ership  of  the  land,  but  who  would  not 
have  found  a  maintenance  but  for  that 
appropriation  of  the  soil  by  which  they 
seem,  at  first  sight,  to  have  been  disin¬ 
herited.” — Sismondi,  “  Studies  in  Po¬ 
litical  Economy,”  Third  Essay,  on  Ter¬ 
ritorial  Wealth. 


VOL.  I.— 15 


226 


POLITICAL  ECONOMY 


they  are  only  valid,  in  so  far  as  the  proprietor  of  land  is  its 
improver.  Whenever,  in  any  country,  the  proprietor,  generally 
speaking,  ceases  to  be  the  improver,  political  economy  has 
nothing  to  say  in  defence  of  landed  property,  as  there  estab¬ 
lished.  In  no  sound  theory  of  private  property  was  it  ever  con¬ 
templated  that  the  proprietor  of  land  should  be  merely  a  sine- 
curist  quartered  on  it. 

In  Great  Britain,  the  landed  proprietor  is  not  unfrequently 
an  improver.  But  it  cannot  be  said  that  he  is  generally  so. 
And  in  the  majority  of  cases  he  grants  the  liberty  of  cultivation 
on  such  terms,  as  to  prevent  improvements  from  being  made 
by  any  one  else.  In  the  southern  parts  of  the  island,  as  there 
are  usually  no  leases,  permanent  improvements  can  scarcely  be 
made  except  by  the  landlord’s  capital ;  accordingly  the  South, 
compared  with  the  North  of  England,  and  with  the  Lowlands 
of  Scotland,  is  still  extremely  backward  in  agricultural  im¬ 
provement.  The  truth  is,  that  any  very  general  improvement 
of  land  by  the  landlords,  is  hardly  compatible  with  a  law  or 
custom  of  primogeniture.  When  the  land  goes  wholly  to  the 
heir,  it  generally  goes  to  him  severed  from  the  pecuniary  re¬ 
sources  which  would  enable  him  to  improve  it,  the  personal 
property  being  absorbed  by  the  provision  for  younger  chil¬ 
dren,  and  the  land  itself  often  heavily  burdened  for  the  same 
purpose.  There  is,  therefore,  but  a  small  proportion  of  land¬ 
lords  who  have  the  means  of  making  expensive  improvements, 
unless  they  do  it  with  borrowed  money,  and  by  adding  to  the 
mortgages  with  which  in  most  cases  the  land  was  already 
burdened  when  they  received  it.  But  the  position  of  the  owner 
of  a  deeply  mortgaged  estate  is  so  precarious ;  economy  is 
so  unwelcome  to  one  whose  apparent  fortune  greatly  exceeds 
his  real  means,  and  the  vicissitudes  of  rent  and  price  which 
only  trench  upon  the  margin  of  his  income,  are  so  formidable 
to  one  who  can  call  little  more  than  the  margin  his  own ;  that 
it  is  no  wonder  if  few  landlords  find  themselves  in  a  condition 
to  make  immediate  sacrifices  for  the  sake  of  future  profit. 
Were  they  ever  so  much  inclined,  those  alone  can  prudently 
do  it,  who  have  seriously  studied  the  principles  of  scientific 
agriculture :  and  great  landlords  have  seldom  seriously  studied 
anything.  They  might  at  least  hold  out  inducements  to  the 
farmers  to  do  what  they  will  not  or  cannot  do  themselves ;  but 
even  in  granting  leases,  it  is  in  England  a  general  complaint 


PROPERTY 


227 


that  they  tie  up  their  tenants  by  covenants  grounded  on  the 
practices  of  an  obsolete  and  exploded  agriculture :  while  most 
of  them,  by  withholding  leases  altogether,  and  giving  the 
farmer  no  guarantee  of  possession  beyond  a  single  harvest, 
keep  the  land  on  a  footing  little  more  favorable  to  improve¬ 
ment  than  in  the  time  of  our  barbarous  ancestors, 

“ -  immetata  quibus  jugera  liberas 

Fruges  et  Cererem  ferunt, 

Nec  cultura  placet  longior  annua.” 

Landed  property  in  England  is  thus  very  far  from  completely 
fulfilling  the  conditions  which  render  its  existence  economi¬ 
cally  justifiable.  But  if  insufficiently  realized  even  in  England, 
in  Ireland  those  conditions  are  not  complied  with  at  all.  With 
individual  exceptions  (some  of  them  very  honorable  ones),  the 
owners  of  Irish  estates  do  nothing  for  the  land  but  drain  it 
of  its  produce.  What  has  been  epigrammatically  said  in  the 
discussions  on  “  peculiar  burdens  ”  is  literally  true  when  ap¬ 
plied  to  them  ;  that  the  greatest  “  burden  on  land  ”  is  the  land¬ 
lords.  Returning  nothing  to  the  soil,  they  consume  its  whole 
produce,  minus  the  potatoes  strictly  necessary  to  keep  the  in¬ 
habitants  from  dying  of  famine :  and  when  they  have  any  pur¬ 
pose  of  improvement,  the  preparatory  step  usually  consists  in 
not  leaving  even  this  pittance,  but  turning  out  the  people  to 
beggary  if  not  to  starvation.*  When  landed  property  has 
placed  itself  upon  this  footing  it  ceases  to  be  defensible,  and 
the  time  has  come  for  making  some  new  arrangement  of  the 
matter. 

When  the  “  sacredness  of  property  ”  is  talked  of,  it  should 
alwavs  be  remembered,  that  anv  such  sacredness  does  not  be- 
long  in  the  same  degree  to  landed  property.  No  man  made  the 
land.  It  is  the  original  inheritance  of  the  whole  species.  Its 
appropriation  is  wholly  a  question  of  general  expediency. 
When  private  property  in  lands  is  not  expedient,  it  is  unjust. 
It  is  no  hardship  to  any  one,  to  be  excluded  from  what  others 
have  produced :  they  were  not  bound  to  produce  it  for  his  use, 
and  he  loses  nothing  by  not  sharing  in  what  otherwise  would 
not  have  existed  at  all.  But  it  is  some  hardship  to  be  born 
into  the  world  and  to  find  all  nature’s  gifts  previously  en- 

*  I  must  beg  the  reader  to  bear  in  nomical,  taking  place  in  our  age,  that, 
mind  that  this  paragraph  was  written  without  perpetually  rewriting  a  work 
eighteen  years  ago  (1848).  So  wonderful  like  the  present,  it  is  impossible  to  keep 
are  the  changes,  both  moral  and  eco-  up  with  them. 


228 


POLITICAL  ECONOMY 


grossed,  and  no  place  left  for  the  new-comer.  To  reconcile 
people  to  this,  after  they  have  once  admitted  into  their  minds 
the  idea  that  any  moral  rights  belong  to  them  as  human  be¬ 
ings,  it  will  always  be  necessary  to  convince  them  that  the  ex¬ 
clusive  appropriation  is  good  for  mankind  on  the  whole,  them¬ 
selves  included.  But  this  is  what  no  sane  human  being  could 
be  persuaded  of,  if  the  relation  between  the  landowner  and  the 
cultivator  were  the  same  everywhere  as  it  has  been  in  Ireland. 

Landed  property  is  felt  even  by  those  most  tenacious  of  its 
rights,  to  be  a  different  thing  from  other  property ;  and  where 
the  bulk  of  the  community  have  been  disinherited  of  their  share 
of  it,  and  it  has  become  the  exclusive  attribute  of  a  small  minor¬ 
ity,  men  have  generally  tried  to  reconcile  it,  at  least  in  theory, 
to  their  sense  of  justice,  by  endeavoring  to  attach  duties  to  it, 
and  erecting  it  into  a  sort  of  magistracy,  either  moral  or  legal. 
But  if  the  state  is  at  liberty  to  treat  the  possessors  of  land  as 
public  functionaries,  it  is  only  going  one  step  further  to  say, 
that  it  is  at  liberty  to  discard  them.  The  claim  of  the  land- 
owners  to  the  land  is  altogether  subordinate  to  the  general  pol¬ 
icy  of  the  state.  The  principle  of  property  gives  them  no  right 
to  the  land,  but  only  a  right  to  compensation  for  whatever  por¬ 
tion  of  their  interest  in  the  land  it  may  be  the  policy  of  the  state 
to  deprive  them  of.  To  that,  their  claim  is  indefeasible.  It  is 
due  to  landowners,  and  to  owners  of  any  property  whatever, 
recognized  as  such  by  the  state,  that  they  should  not  be  dis¬ 
possessed  of  it  without  receiving  its  pecuniary  value,  or  an  an¬ 
nual  income  equal  to  what  they  derived  from  it.  This  is  due 
on  the  general  principles  on  which  property  rests.  If  the  land 
was  bought  with  the  produce  of  the  labor  and  abstinence  of 
themselves  or  their  ancestors,  compensation  is  due  to  them  on 
that  ground ;  even  if  otherwise,  it  is  still  due  on  the  ground 
of  prescription.  Nor  can  it  ever  be  necessary  for  accomplish¬ 
ing  an  object  by  which  the  community  altogether  will  gain, 
that  a  particular  portion  of  the  community  should  be  immo¬ 
lated.  When  the  property  is  of  a  kind  to  which  peculiar  af¬ 
fections  attach  themselves,  the  compensation  ought  to  exceed 
a  bare  pecuniary  equivalent.  But,  subject  to  this  proviso,  the 
state  is  at  liberty  to  deal  with  landed  property  as  the  general 
interests  of  the  community  may  require,  even  to  the  extent,  if 
it  so  happen,  of  doing  with  the  whole,  what  is  done  with  a  part 
whenever  a  bill  is  passed  for  a  railroad  or  a  new  street.  The 


PROPERTY 


229 


community  has  too  much  at  stake  in  the  proper  cultivation  of 
the  land,  and  in  the  conditions  annexed  to  the  occupancy  of  it, 
to  leave  these  things  to  the  discretion  of  a  class  of  persons 
called  landlords,  when  they  have  shown  themselves  unfit  for 
the  trust.  The  legislature,  which  if  it  pleased  might  convert 
the  whole  body  of  landlords  into  fund-holders  or  pensioners, 
might,  a  fortiori,  commute  the  average  receipts  of  Irish  land- 
owners  into  a  fixed  rent  charge,  and  raise  the  tenants  into  pro¬ 
prietors  ;  supposing  always  that  the  full  market  value  of  the 
land  was  tendered  to  the  landlords,  in  case  they  preferred  that 
to  accepting  the  conditions  proposed. 

There  will  be  another  place  for  discussing  the  various  modes 
of  landed  property  and  tenure,  and  the  advantages  and  incon¬ 
veniences  of  each  ;  in  this  chapter  our  concern  is  with  the  right 
itself,  the  grounds  which  justify  it,  and  (as  a  corollary  from 
these)  the  conditions  by  which  it  should  be  limited.  To  me 
it  seems  almost  an  axiom  that  property  in  land  should  be  inter¬ 
preted  strictly,  and  that  the  balance  in  all  cases  of  doubt  should 
incline  against  the  proprietor.  The  reverse  is  the  case  with 
property  in  movables,  and  in  all  things  the  product  of  labor; 
over  these,  the  owner’s  power  both  of  use  and  of  exclusion 
should  be  absolute,  except  where  positive  evil  to  others  would 
result  from  it ;  but  in  the  case  of  land,  no  exclusive  right  should 
be  permitted  in  any  individual,  which  cannot  be  shown  to  be 
productive  of  positive  good.  To  be  allowed  any  exclusive  right 
at  all,  over  a  portion  of  the  common  inheritance,  while  there  are 
others  who  have  no  portion,  is  already  a  privilege.  No  quan¬ 
tity  of  movable  goods  which  a  person  can  acquire  by  his  labor, 
prevents  others  from  acquiring  the  like  by  the  same  means ; 
but  from  the  very  nature  of  the  case,  whoever  owns  land,  keeps 
others  out  of  the  enjoyment  of  it.  The  privilege,  or  monopoly, 
is  only  defensible  as  a  necessary  evil ;  it  becomes  an  injustice 
when  carried  to  any  point  to  which  the  compensating  good 
does  not  follow  it. 

For  instance,  the  exclusive  right  to  the  land  for  purposes 
of  cultivation  does  not  imply  an  exclusive  right  to  it  for  pur¬ 
poses  of  access ;  and  no  such  right  ought  to  be  recognized, 
except  to  the  extent  necessary  to  protect  the  produce  against 
damage,  and  the  owner’s  privacy  against  invasion.  The  pre¬ 
tension  of  two  Dukes  to  shut  up  a  part  of  the  Highlands,  and 
exclude  the  rest  of  mankind  from  many  square  miles  of  moun- 


230 


POLITICAL  ECONOMY 


tain  scenery  to  prevent  disturbance  to  wild  animals,  is  an  abuse  ; 
it  exceeds  the  legitimate  bounds  of  the  right  of  landed  property. 
When  land  is  not  intended  to  be  cultivated,  no  good  reason 
can  in  general  be  given  for  its  being  private  property  at  all; 
and  if  any  one  is  permitted  to  call  it  his,  he  ought  to  know  that 
he  holds  it  by  sufferance  of  the  community,  and  on  an  implied 
condition  that  his  ownership,  since  it  cannot  possibly  do  them 
any  good,  at  least  shall  not  deprive  them  of  any,  which  they 
could  have  derived  from  the  land  if  it  had  been  unappropriated. 
Even  in  the  case  of  cultivated  land,  a  man  whom,  though  only 
one  among  millions,  the  law  permits  to  hold  thousands  of  acres 
as  his  single  share,  is  not  entitled  to  think  that  all  this  is  given 
to  him  to  use  and  abuse,  and  deal  with  as  if  it  concerned  no¬ 
body  but  himself.  The  rents  or  profits  which  he  can  obtain 
from  it  are  at  his  sole  disposal ;  but  with  regard  to  the  land, 
in  everything  which  he  does  with  it,  and  in  everything  which 
he  abstains  from  doing,  he  is  morally  bound,  and  should  when¬ 
ever  the  case  admits  be  legally  compelled,  to  make  his  interest 
and  pleasure  consistent  with  the  public  good.  The  species  at 
large  still  retains,  of  its  original  claim  to  the  soil  of  the  planet 
which  it  inhabits,  as  much  as  is  compatible  with  the  purposes 
for  which  it  has  parted  with  the  remainder. 

§  7.  Besides  property  in  the  produce  of  labor,  and  property 
in  land,  there  are  other  things  which  are  or  have  been  subjects 
of  property,  in  which  no  proprietary  rights  ought  to  exist  at 
all.  But  as  the  civilized  world  has  in  general  made  up  its  mind 
on  most  of  these,  there  is  no  necessity  for  dwelling  on  them  in 
this  place.  At  the  head  of  them,  is  property  in  human  beings. 
It  is  almost  superfluous  to  observe,  that  this  institution  can 
have  no  place  in  any  society  even  pretending  to  be  founded  on 
justice,  or  on  fellowship  between  human  creatures.  But,  in¬ 
iquitous  as  it  is,,  yet  when  the  state  has  expressly  legalized  it, 
and  human  beings,  for  generations,  have  been  bought,  sold, 
and  inherited  under  sanction  of  law,  it  is  another  wrong,  in 
abolishing  the  property,  not  to  make  full  compensation.  This 
wrong  was  avoided  by  the  great  measure  of  justice  in  1833, 
one  of  the  most  virtuous  acts,  as  well  as  the  most  practically 
beneficent,  ever  done  collectively  by  a  nation.  Other  exam¬ 
ples  of  property  which  ought  not  to  have  been  created,  are 
properties  in  public  trusts ;  such  as  judicial  offices  under  the 
old  French  regime ,  and  the  heritable  jurisdictions  which,  in 


CLASSES  WHO  DIVIDE  THE  PRODUCE 


231 


countries  not  wholly  emerged  from  feudality,  pass  with  the 
land.  Our  own  country  affords,  as  cases  in  point,  that  of  a 
commission  in  the  army,  and  of  an  advowson,  or  right  of  nomi¬ 
nation  to  an  ecclesiastical  benefice.  A  property  is  also  some¬ 
times  created  in  a  right  of  taxing  the  public ;  in  a  monopoly, 
for  instance,  or  other  exclusive  privilege.  These  abuses  pre¬ 
vail  most  in  semi-barbarous  countries ;  but  are  not  without 
example  in  the  most  civilized.  In  France  there  are*  several  im¬ 
portant  trades  and  professions,  including  notaries,  attorneys, 
brokers,  appraisers,  printers,  and  (until  lately)  bakers  and 
butchers,  of  which  the  numbers  are  limited  by  law.  The  brevet 
or  privilege  of  one  of  the  permitted  number  consequently 
brings  a  high  price  in  the  market.  When  this  is  the  case, 
compensation  probably  could  not  with  justice  be  refused,  on 
the  abolition  of  the  privilege.  There  are  other  cases  in  which 
this  would  be  more  doubtful.  The  question  would  turn  upon 
what,  in  the  peculiar  circumstances,  was  sufficient  to  consti¬ 
tute  prescription ;  and  whether  the  legal  recognition  which 
the  abuse  had  obtained,  was  sufficient  to  constitute  it  an  insti¬ 
tution,  or  amounted  only  to  an  occasional  license.  It  would 
be  absurd  to  claim  compensation  for  losses  caused  by  changes 
in  a  tariff,  a  thing  confessedly  variable  from  year  to  year ;  or 
for  monopolies  like  those  granted  to  individuals  by  the  Tudors, 
favors  of  a  despotic  authority,  which  the  power  that  gave  was 
competent  at  any  time  to  recall. 

So  much  on  the  institution  of  property,  a  subject  of  which, 
for  the  purposes  of  political  economy,  it  was  indispensable  to 
treat,  but  on  which  we  could  not  usefully  confine  ourselves  to 
economical  considerations.  We  have  now  to  inquire  on  what 
principles  and  with  what  results  the  distribution  of  the  produce 
of  land  and  labor  is  effected,  under  the  relations  which  this 
institution  creates  among  the  different  members  of  the  com¬ 
munity. 

Chapter  III.  —  Of  the  Classes  among  Whom  the  Produce  is 

Distributed 

§  1.  Private  property  being  assumed  as  a  fact,  we  have  next 
to  enumerate  the  different  classes  of  persons  to  whom  it  gives 
rise  ;  whose  concurrence,  or  at  least  whose  permission,  is  neces¬ 
sary  to  production,  and  who  are  therefore  able  to  stipulate  for 
a  share  of  the  produce.  We  have  to  inquire,  according  to  what 


232 


POLITICAL  ECONOMY 


laws  the  produce  distributes  itself  among  these  classes,  by  the 
spontaneous  action  of  the  interests  of  those  concerned:  after 
which,  a  further  question  will  be,  what  effects  are  or  might  be 
produced  by  laws,  institutions,  and  measures  of  government, 
in  superseding  or  modifying  that  spontaneous  distribution. 

The  three  requisites  of  production,  as  has  been  so  often  re¬ 
peated,  are  labor,  capital,  an^Lland understanding  by  capital, 
the  means  and  appliances  which  are  the  accumulated  results 
of  previous  labor,  and  by  land,  the  materials  and  instruments 
supplied  by  nature,  whether  contained  in  the  interior  of  the 
earth  or  constituting  its  surface.  Since  each  of  these  elements 
of  production  may  be  separately  appropriated,  the  industrial 
community  may  be  considered  as  divided  into  jandowners, 
capitalists,  and  productive  laborers.  Each  of  these  classes,  as 
such,  obtains  a  share  of  the  produce :  no  other  person  or  class 
obtains  anything,  except  by  concession  from  them.  The  re¬ 
mainder  of  the  community  is,  in  fact,  supported  at  their  ex¬ 
pense,  giving,  if  any  equivalent,  one  consisting  of  unproduc¬ 
tive  services.  JThese  three  classes,  therefore,  are  considered 
in  political  economy  as  making  up  the  whole  community. 

§  2.  But  although  these  three  sometimes  exist  as  separate 
classes,  dividing  the  produce  among  them,  they  do  not  neces¬ 
sarily  or  always  so  exist.  The  fact  is  so  much  otherwise,  that 
there  are  only  one  or  two  communities  in  which  the  complete 
separation  of  these  classes  is  the  general  rule.  England  and 
Scotland,  with  parts  of  Belgium  and  Holland,  are  almost  the 
only  countries  in  the  world  where  the  land,  capital,  and  labor 
employed  in  agriculture,  are  generally  the  property  of  separate 
owners.  The  ordinary  case  is,  that  the  same  person  owns  either 
two  of  these  requisites,  or  all  three. 

The  case  in  which  the  same  person  owns  all  three,  embraces 
the  two  extremes  of  existing  society,  in  respect  to  the  inde¬ 
pendence  and  dignity  of  the  laboring  class.  First,  when  the 
laborer  himself  is  the  proprietor.  This  is  the  commonest  case 
in  the  Northern  States  of  the  American  Union  ;  one  of  the  com¬ 
monest  in  France,  Switzerland,  the  three  Scandinavian  king¬ 
doms,  and  parts  of  Germany ;  *  and  a  common  case  in  parts 


The  Norwegian  return  ”  (say  the 
Commissioners  of  Poor  Law  Inquiry, 
to  whom  information  was  furnished  from 
nearly  every  country  in  Europe  and 
America  by  the  ambassadors  and  con¬ 
suls  there)  “  states  that  at  the  last  cen¬ 


sus  in  1825,  out  of  a  population  of  1,051,- 
318  persons,  there  were  59,464  freeholders. 
As  by  59,464  freeholders  must  be  meant 
59,464  heads  of  families,  or  about  300,000 
individuals;  the  freeholders  must  form 
more  than  one-fourth  of  the  whole  popu- 


CLASSES  WHO  DIVIDE  THE  PRODUCE 


233 


of  Italy  and  in  Belgium.  In  all  these  countries  there  are,  no 
doubt,  large  landed  properties,  and  a  still  greater  number 
which,  without  being  large,  require  the  occasional  or  constant 
aid  of  hired  laborers.  Much,  however,  of  the  land  is  owned  in 
portions  too  small  to  require  any  other  labor  than  that  of  the 
peasant  and  his  family,  or  fully  to  occupy  even  that.  The 
capital  employed  is  not  always  that  of  the  peasant  proprietor, 
many  of  these  small  properties  being  mortgaged  to  obtain  the 
means  of  cultivating ;  but  the  capital  is  invested  at  the  peasant’s 
risk,  and  though  he  pays  interest  for  it,  it  gives  to  no  one  any 
right  of  interference,  except  perhaps  eventually  to  take  posses¬ 
sion  of  the  land,  if  the  interest  ceases  to  be  paid. 

The  other  case  in  which  the  land,  labor,  and  capital,  belong 
to  the  same  person,  is  the  case  of  slave  countries,  in  which  the 
laborers  themselves  are  owned  by  the  landowner.  Our  West 
India  colonies  before  emancipation,  and  the  sugar  colonies  of 
the  nations  by  whom  a  similar  act  of  justice  is  still  unperformed, 
are  examples  of  large  establishments  for  agricultural  and  man¬ 
ufacturing  labor  (the  production  of  sugar  and  rum  is  a  com¬ 
bination  of  both)  in  which  the  land,  the  factories  (if  they  may 
be  so  called),  the  machinery,  and  the  degraded  laborers,  are 
all  the  property  of  a  capitalist.  In  this  case,  as  well  as  in  its 
extreme  opposite,  the  case  of  the  peasant  proprietor,  there  is 
no  division  of  the  produce. 

§  3.  When  the  three  requisites  are  not  all  owned  by  the  same 
person,  it  often  happens  that  two  of  them  are  so.  Sometimes 
the  same  person  owns  the  capital  and  the  land,  but  not  the 
labor.  The  landlord  makes  his  engagement  directly  with  the 
laborer,  and  supplies  the  whole  or  part  of  the  stock  necessary 
for  cultivation.  This  system  is  the  usual  one  in  those  parts  of 
Continental  Europe,  in  which  the  laborers  are  neither  serfs  on 
the  one  hand,  nor  proprietors  on  the  other.  It  was  very  com- 


lation.  Mr.  Macgregor  states  that  in 
Denmark  (by  which  Zealand  and  the 
adjoining  islands  are  probably  meant) 
out  of  a  population  of  926,110,  the  num¬ 
ber  of  landed  proprietors  and  farmers  is 
415,110,  or  nearly  one-half.  In  Sleswick- 
Holstein,  out  of  a  population  of  604,085, 
it  is  196,017,  or  about  one-third.  The 
proportion  of  proprietors  and  farmers 
to  the  whole  population  is  not  given  in 
Sweden;  but  the  Stockholm  return  esti¬ 
mates  the  average  quantity  of  land  an¬ 
nexed  to  a  laborer’s  habitation  at  from 
one  to  five  acres;  and  though  the  Got- 
tenburg  return  gives  a  lower  estimate, 
it  adds,  that  the  peasants  possess  much 


of  the  land.  In  Wurtemburg  we  are 
told  that  more  than  two-thirds  of  the  la¬ 
boring  population  are  the  proprietors 
of  their  own  habitations,  and  that  al¬ 
most  all  own  at  least  a  garden  of  from 
three-quarters  of  an  acre  to  an  acre  and 
a  half.”  In  some  of  these  statements, 
proprietors  and  farmers  are  not  discrimi¬ 
nated;  but  “all  the  returns  concur  in 
stating  the  number  of  day-laborers  to  be 
very  small.”— (“  Preface  to  Foreign 
Communications,”  p.  xxxviii.)  As  the 
general  status  of  the  laboring  people, 
the  condition  of  a  workman  for  hire  is 
almost  peculiar  to  Great  Britain. 


234 


POLITICAL  ECONOMY 


mon  in  France  before  the  Revolution,  and  is  still  much  prac¬ 
tised  in  some  parts  of  that  country,  when  the  land  is  not  the 
property  of  the  cultivator.  It  prevails  generally  in  the  level 
districts  of  Italy,  except  those  principally  pastoral,  such  as  the 
Maremma  of  Tuscany  and  the  Campagna  of  Rome.  On  this 
system  the  division  of  the  produce  is  between  two  classes,  the 
landowner  and  the  laborer. 

In  other  cases  again  the  laborer  does  not  own  the  land,  but 
owns  the  little  stock  employed  on  it,  the  landlord  not  being  in 
the  habit  of  supplying  any.  This  system  generally  prevails  in 
Ireland.  It  is  nearly  universal  in  India,  and  in  most  countries 
of  the  East ;  whether  the  government  retains,  as  it  generally 
does,  the  ownership  of  the  soil,  or  allows  portions  to  become, 
either  absolutely  or  in  a  qualified  sense,  the  property  of  indi¬ 
viduals.  In  India,  however,  things  are  so  far  better  than  in 
Ireland,  that  the  owner  of  land  is  in  the  habit  of  making  ad¬ 
vances  to  the  cultivators,  if  they  cannot  cultivate  without  them. 
For  these  advances  the  native  landed  proprietor  usually  de¬ 
mands  high  interest ;  but  the  principal  landowner,  the  govern¬ 
ment,  makes  them  gratuitously,  recovering  the  advance  after 
the  harvest,  together  with  the  rent.  The  produce  is  here  di¬ 
vided,  as  before  between  the  same  two  classes,  the  landowner 
and  the  laborer. 

These  are  the  principal  variations  in  the  classification  of 
those  among  whom  the  produce  of  agricultural  labor  is  dis¬ 
tributed.  In  the  case  of  manufacturing  industry  there  never 
are  more  than  two  classes,  the  laborers  and  the  capitalists. 
The  original  artisans  in  all  countries  were  either  slaves,  or  the 
women  of  the  family.  In  the  manufacturing  establishments  of 
the  ancients,  whether  on  a  large  or  on  a  small  scale,  the  la¬ 
borers  were  usually  the  property  of  the  capitalist.  In  general, 
if  any  manual  labor  was  thought  compatible  with  the  dignity 
of  a  freeman,  it  was  only  agricultural  labor.  The  converse  sys¬ 
tem,  in  which  the  capital  was  owned  by  the  laborer,  was  coeval 
with  free  labor,  and  under  it  the  first  great  advances  of  manu¬ 
facturing  industry  were  achieved.  The  artisan  owned  the  loom 
or  the  few  tools  he  used,  and  worked  on  his  own  account ;  or  at 
least  ended  by  doing  so,  though  he  usually  worked  for  an¬ 
other,  first  as  apprentice  and  next  as  journeyman,  for  a  certain 
number  of  years  before  he  could  be  admitted  a  master.  But 
the  status  of  a  permanent  journeyman,  all  his  life  a  hired  laborer 


COMPETITION  AND  CUSTOM 


235 


and  nothing  more,  had  no  place  in  the  crafts  and  guilds  of  the 
Middle  Ages.  In  country  villages,  where  a  carpenter  or  a 
blacksmith  cannot  live  and  support  hired  laborers  on  the  re¬ 
turns  of  his  business,  he  is  even  now  his  own  workman ;  and 
shopkeepers  in  similar  circumstances  are  their  own  shopmen, 
or  shopwomen.  But  wherever  the  extent  of  the  market  admits 
of  it,  the  distinction  is  now  fully  established  between  the  class 
of  capitalists,  or  employers  of  labor,  and  the  class  of  laborers ; 
the  capitalists,  in  general,  contributing  no  other  labor  than  that 
of  direction  and  superintendence. 


Chapter  IV. — Of  Competition  and  Custom 

§i.  Under  the  rule  of  individual  property,  the  division  of  the 
produce  is  the  result  of  two  determining  agencies:  Competition, 
and  Custom.  It  is  important  to  ascertain  the  amount  of  influ¬ 
ence  which  belongs  to  each  of  these  causes,  and  in  what  manner 
the  operation  of  one  is  modified  by  the  other. 

Political  economists  generally,  and  English  political  econo¬ 
mists  above  others,  have  been  accustomed  to  lay  almost  ex¬ 
clusive  stress  upon  the  first  of  these  agencies;  to  exaggerate 
the  effect  of  competition,  and  to  take  into  little  account  the 
other  and  conflicting  principle.  They  are  apt  to  express  them- 
selves  as  if  they  thought  that  competition  actually  does,  in  all 
£ases,  whatever  it  can  be  shown  to  be  the  tendency  of  competi- 
Tlon  to  do.  This  is  partly  intelligible,  if  we  consider  that  only 
through  the  principle  of  competition  has  political  economy  any 
pretension  to  the  character  of  a  science.  So  far  as  rents,  profits, 
wages,  prices,  are  determined  bv  competition,  laws  may  be  as¬ 
signed  for  them.  Assume  competition  to  be  their  exclusive 
regulator,  and  principles  of  broad  generality  and  scientific  pre1 
cision  may  be  laid  down,  according  to  which  they  wifi  be  regu¬ 
lated.  The  political  economist  justly  deems  this  his  proper 
ftusinessT'and,  as  an  abstract  or  hypothetical  science,  political 
economy  cannot  He  required  to  do,  and  indeed  cannot  dp,  anv- 
thing  more.  But  it  would  be  a  great  misconception  of  the  actual 
course  of  human  affairs,  to  suppose  that  competitionTexercises 
in  fact  this  unlimited  sway.  I  am  not  speaking  ~of  monopolies, 
Either  natural  or  artificial,  or  of  any  interferences  of  authority 
with  the  liberty  of  production  or  exchange.  Such  disturbing 


2  36 


POLITICAL  ECONOMY 


causes  have  always  been  allowed  for  by  political  economists.  J. 
speak  of  cases  in  which  there  is  nothing  to  restrain  competition : 

no  hindrance  to  it  either  in  the  nature  of  the  case  or  in  artificial 

obstacles ;  yet  in  which  the  result  is  not  determined  by  competi¬ 
tion,  but  by  custom  or  usage;  competition  either  not  taking 
place  at  all,  or  xmducing  its  .effect Jn^uite  _a^differenL  manner 
from  that  which  is  ordinarily  assumed  to  be  natural  tort. 

§  2.  Competition,  in  fact,  has  only  become  in  any  considerable 
degree  the  governing  principle  of  contracts,  at  a  comparatively 
modern  period.  The  further  we  look  back  into  history,  the  more 
we  see  all  transactions  and  engagements  under  the  influence  of 
fixed  customs.  The  reason  is  evident.  Custom  is  the  most 
powerful  protector  of  the  weak  against  the  strong;  their  sole 
ftPflteCtor  where  there  areTlO  laws  or  government  adequate  to 
thFpprpose.  Custom  is  a  barrier  which,  even  in  the  most  op¬ 
pressed  condition  of  marrkind.  tyranny  is  forced  in  some  degree 
to  respect.  To  the  industrious  population  in  a  turbulent  military 
community,  freedom  of  competition  is  a  vain  phrase;  they  are 
never  in  a  condition  to  make  terms  for  themselves  by  it:  there  is 
always  a  master  who  throws  his  sword  into  the  scale,  and  the 
terms  are  such  as  he  imposes.  But  though  the  law  of  the  strong¬ 
est  decides,  it  is  not  the  interest  nor  in  general  the  practice  of 
the  strongest  to  strain  that  law  to  the  utmost,  and  every  relaxa¬ 
tion  of  it  has  a  tendency  to  become  a  custom,  and  every  custom 
to  become  a  right.  Rights  thus  originating,  and  not  competi¬ 
tion  in  any  shape,  determine,  in  a  rude  state  ot  society,  the 
share  of  the  produce  enjoyed  by  those  who  produce  it.  The  re¬ 
lations,  more  especially,  between  the  landowner  and  the  cujti- 
vator,  and  the  payments  made  by  the  latter  to  the,  former,  are, 
in  all  states  of  society  but  the  most  modern,  determined  by  the 
usage  of  the  country.  “Never  until  late  times  have  the  conditions 
oT  the  occupancy  of  land  been  (as  a  general  rule)  an  affair  of 
competition.  The  occupier  for  the  time  has  very  commonly 
been  considered  to  have  a  right  to  retain  his  holding,  while  he 
fulfils  the  customary  requirements;  and  has  thus  become,  in  a 
certain  sense,  a  co-proprietor  of  the  soil.  Even  where  the  holder 
has  not  acquired  this  fixity  of  tenure,  the  terms  of  occupation 
have  often  been  fixed  and  invariable. 

In  India,  for  example,  and  other  Asiatic  communities  simi¬ 
larly  constituted,  the  ryots,  or  peasant-farmers,  are  not  regarded 
as  tenants  at  will,  nor  even  as  tenants  by  virtue  of  a  lease.  In 


COMPETITION  AND  CUSTOM 


237 


most  villages  there  are  indeed  some  ryots  on  this  precarious 
footing,  consisting  of  those,  or  the  descendants  of  those,  who 
have  settled  in  the  place  at  a  known  and  comparatively  recent 
period:  but  all  who  are  looked  upon  as  descendants  or  repre¬ 
sentatives  of  the  original  inhabitants,  and  even  many  mere  ten¬ 
ants  of  ancient  date,  are  thought  entitled  to  retain  their  land, 
as  long  as  they  pay  the  customary  rents.  What  these  customary 
rents  are,  or  ought  to  be,  has  indeed,  in  most  cases,  become  a 
matter  of  obscurity;  usurpation,  tyranny,  and  foreign  conquest 
having  to  a  great  degree  obliterated  the  evidences  of  them.  But 
when  an  old  and  purely  Hindoo  principality  falls  under  the  do¬ 
minion  of  the  British  Government,  or  the  management  of  its 
officers,  and  when  the  details  of  the  revenue  system  come  to  be 
inquired  into,  it  is  usually  found  that  though  the  demands  of 
the  great  landholder,  the  State,  have  been  swelled  by  fiscal  ra¬ 
pacity  until  all  limit  is  practically  lost  sight  of,  it  has  yet  been 
thought  necessary  to  have  a  distinct  name  and  a  separate  pretext 
for  each  increase  of  exaction ;  so  that  the  demand  has  sometimes 
come  to  consist  of  thirty  or  forty  different  items,  in  addition  to 
the  nominal  rent.  This  circuitous  mode  of  increasing  the  pay¬ 
ments  assuredly  would  not  have  been  resorted  to,  if  there  had 
been  an  acknowledged  right  in  the  landlord  to  increase  the  rent. 
Its  adoption  is  a  proof  that  there  was  once  an  effective  limita¬ 
tion,  a  real  customary  rent;  and  that  the  understood  right  of  the 
ryot  to  the  land,  so  long  as  he  paid  rent  according  to  custom,  was 
at  some  time  or  other  more  than  nominal.*  The  British  Govern¬ 
ment  of  India  always  simplifies  the  tenure  by  consolidating  the 
various  assessments  into  one,  thus  making  the  rent  nominally  as 
well  as  really  an  arbitrary  thing,  or  at  least  a  matter  of  specific 
agreement:  but  it  scrupulously  respects  the  right  of  the  ryot  to 
the  land,  though  until  the  reforms  of  the  present  generation  (re¬ 
forms  even  now  only  partially  carried  into  effect)  it  seldom  left 
him  much  more  than  a  bare  subsistence. 

In  modern  Europe  the  cultivators  have  gradually  emerged 
from  a  state  of  personal  slavery.  The  barbarian  conquerors  of 
the  Western  empire  found  that  the  easiest  mode  of  managing 
their  conquests  would  be  to  leave  the  occupation  of  the  land  in 
the  hands  in  which  they  found  it,  and  to  save  themselves  a  labor 

*  The  ancient  law  books  of  the  Hin-  that  the  rules  laid  down  in  those  books 

doos  mention  in  some  cases  one-sixth,  were,  at  any  period  of  history,  really 

in  others  one-fourth  of  the  produce,  as  acted  upon, 
a  proper  rent;  but  there  is  no  evidence 


238 


POLITICAL  ECONOMY 


so  uncongenial  as  the  superintendence  of  troops  of  slaves,  by 
allowing  the  slaves  to  retain  in  a  certain  degree  the  control  of 
their  own  actions,  under  an  obligation  to  furnish  the  lord  with 
provisions  and  labor.  A  common  expedient  was  to  assign 
to  the  serf,  for  his  exclusive  use,  as  much  land  as  was  thought 
sufficient  for  his  support,  and  to  make  him  work  on  the  other 
lands  of  his  lord  whenever  required.  By  degrees  these  indefinite 
obligations  were  transformed  into  a  definite  one,  of  supplying 
a  fixed  quantity  of  provisions  or  a  fixed  quantity  of  labor:  and 
as  the  lords,  in  time,  became  inclined  to  employ  their  income  in 
the  purchase  of  luxuries  rather  than  in  the  maintenance  of  re¬ 
tainers,  the  payments  in  kind  were  commuted  for  payments  in 
money.  Each  concession,  at  first  voluntary  and  revocable  at 
pleasure,  gradually  acquired  the  force  of  custom,  and  was  at 
last  recognized  and  enforced  by  the  tribunals.  In  this  manner 
the  serfs  progressively  rose  into  a  free  tenantry,  who  held  their 
land  in  perpetuity  on  fixed  conditions.  The  conditions  were 
sometimes  very  onerous,  and  the  people  very  miserable.  But 
their  obligations  were  determined  by  the  usage  or  law  of  the 
country,  and  not  by  competition. 

Where  the  cultivators  had  never  been,  strictly  speaking,  in 
personal  bondage,  or  after  they  had  ceased  to  be  so,  the  exigen¬ 
cies  of  a  poor  and  little  advanced  society  gave  rise  to  another 
arrangement,  which  in  some  parts  of  Europe,  even  highly  im¬ 
proved  parts,  has  been  found  sufficiently  advantageous  to  be 
continued  to  the  present  day.  I  speak  of  the  metayer  system. 
Under  this,  the  land  is  divided  in  small  farms,  among  single 
families,  the  landlord  generally  supplying  the  stock  which  the 
agricultural  system  of  the  country  is  considered  to  require,  and 
receiving,  in  lieu  of  rent  and  profit,  a  fixed  proportion  of  the 
produce.  This  proportion,  which  is  generally  paid  in  kind, 
is  usually  (as  is  implied  in  the  words  metayer ,  mezzaiuolo ,  and 
medietarius),  one-half.  There  are  places,  however,  such  as  the 
rich  volcanic  soil  of  the  province  of  Naples,  where  the  landlord 
takes  two-thirds,  and  yet  the  cultivator  by  means  of  an  excellent 
agriculture  contrives  to  live.  But  whether  the  proportion  is  two- 
thirds  or  one-half,  it  is  a  fixed  proportion;  not  variable  from 
farm  to  farm,  or  from  tenant  to  tenant.  The  custom  of  the 
country  is  the  universal  rule ;  nobody  thinks  of  raising  or  lower¬ 
ing  rents,  or  of  letting  land  on  other  than  the  customary  condi¬ 
tions.  Competition,  as  a  regulator  of  rent,  has  no  existence. 


COMPETITION  AND  CUSTOM 


239 


§  3-  Prices,  whenever  there  _was  no  monopoly,  came  earlier 
under  the  influence  of  competition,  and  are  much  more  univer¬ 
sally  subject  to  it,  than  rents :  but  that  influence  is  by  no  means, 
even  in  the  present  activity  of  mercantile  competition,  36  absu- 
Jlite  as  is  sometimes  assumed.  There  is  no  proposition  which 
meets  us  in  the  field  of  political  economy  oftener  than  this — that 
there  cannot  be  two  prices  in  the  same  market,  ^uch  undoubt¬ 
edly  is  the  natural  effect  of  unimpeded  competition ;  yet  every¬ 
one  knows  that  there  are,  almost  always,  two  prices  in  the  same 
market.  Not  only  are  there  in  every  large  town,  and  in  almost 
every  trade,  cheap  shops  and  dear  shops,  but  the  same  shop 
often  sells  the  same  article  at  different  prices  to  different  cus¬ 
tomers:  and,  as  a  general  rule,  each  retailer  adapts  his  scale 
of  prices  to  the  class  of  customers  whom  he  expects.  The  whole¬ 
sale  trade,  in  the  great  articles  of  commerce,  is  really  under  the 
dominion  of  competition.  There,  the  buyers  as  well  as  sellers 
are  traders  or  manufacturers,  and  their  purchases  are  not  influ¬ 
enced  by  indolence  or  vulgar  finery,  nor  depend  on  the  smaller 
motives  of  personal  convenience,  but  are  business  transactions. 
In  the  wholesale  markets  therefore  it  is  true  as  a  general  propo¬ 
sition,  that  there  are  not  two  prices  at  one  time  for  the  same 
thing:  there  is  at  each  time  and  place  a  market  price,  which 
can  be  quoted  in  a  price-current,  ^But  retail  priceT  the  price 
paid  bv  the  actual  consumer^  seems  to  feel  very  slowly  and  im¬ 
perfectly  the  effect  of  competition ;  and  when  competition  does 
exist,  it  often,  instead  of  lowering  prices,  merely  divides  the 
gains  of  the  high  price  among  a  greater  number  of  dealers. 
Hence  it  is  that,  of  the  price  paid  by  the  consumer,  so  large  a 
proportion  is  absorbed  by  the  gains  of  retailers;  and  anyone 
who  inquires  into  the  amount  which  reaches  the  hands  of  those 
who  made  the  things  he  buys,  will  often  be  astonished  at  its  small¬ 
ness.  When  indeed  the  market,  being  that  of  a  great  city, 
holds  out  a  sufficient  inducement  to  large  capitalists  to  engage 
in  retail  operations,  it  is  generally  found  a  better  speculation  to 
attract  a  large  business  by  underselling  others,  than  merely  to  di¬ 
vide  the  field  of  employment  with  them.  This  influence  of  com¬ 
petition  is  making  itself  felt  more  and  more  through  the  princi¬ 
pal  branches  of  retail  trade  in  the  large  townsj  and  the  rapidity 
and  cheapness  of  transport,  by  making  consumers  less  depen¬ 
dent  on  the  dealers  in  their  immediate  neighborhood,  are  tend¬ 
ing  to  assimilate  more  and  more  the  whole  country  to  a  large 


240 


POLITICAL  ECONOMY 


town;  but  hitherto  it  is  only  in  the  great  centres  of  business  that 
retail  transactions  have  been  chiefly,  or  even  much,  determined 
by  competition.  Elsewhere  it  rather  acts,  when  it  acts  at  all,  as 
an  occasional  disturbing  influence;  the  habitual  regulator  is  cus¬ 
tom,  modified  from  time  to  time  by  notions  existing  in  the 
minds  of  purchasers  and  sellers,  of  some  kind  of  equity  or  justice/ 

In  many  trades  the  terms  on  which  business  is  done  are  a 
matter  of  positive  arrangement  among  the  trade,  who  use  the 
means  they  always  possess  of  making  the  situation  of  any  mem¬ 
ber  of  the  body  who  departs  from  its  fixed  customs,  inconvenient 
or  disagreeable.  It  is  well  known  that  the  bookselling  trade  was, 
until  lately,  one  of  these,  and  that  notwithstanding  the  active 
spirit  of  rivalry  in  the  trade,  competition  did  not  produce  its 
natural  effect  in  breaking  down  the  trade  rules.  All  professional 
remuneration  is  regulated  by  custom.  The  fees  of  physicians, 
surgeons,  and  barristers,  the  charges  of  attorneys,  are  nearly  in-* 
variable.  Not  certainly  for  want  of  abundant  competition  An 
those  professions,  but  because  the  competition  operates  by  di¬ 
minishing  each  competitor’s  chance  of  fees,  not  by  lowering  the 
fees  themselves. 

Since  custom  stands  its  ground  against  competition  to  so  con¬ 
siderable  an  extent,  even  where,  from  the  multitude  of  competi¬ 
tors  and  the  general  energy  in  the  pursuit  of  gain,  the  spirit  of 
competition  is  strongest,  we  may  be  sure  that  this  is  much  more 
the  case  where  people  are  content 'with  smaller  gains,  and  esti¬ 
mate  their  pecuniary  interest  at  a  lower  rate  when  balanced 
against  their  ease  or  their  pleasure.  I  believe  it  will  often  be 
found,  in  Continental  Europe,  that  prices  and  charges,  of  some 
or  of  all  sorts,  are  much  higher  in  some  places  than  in  others  not 
far  distant,  without  its  being  possible  to  assign  any  other  cause 
than  that  it  has  always  been  so:  the  customers  are  used  to  it,  and 
acquiesce  in  it.  An  enterprising  competitor,  with  sufficient  capi¬ 
tal,  might  force  down  the  charges,  and  make  his  fortune  during 
the  process;  but  there  are  no  enterprising  competitors;  those 
who  have  capital  prefer  to  leave  it  where  it  is,  or  to  make  less 
profit  by  it  in  a  more  quiet  way. 

These  observations  must  be  received  as  a  general  correction, 
to  be  applied  whenever  relevant,  whether  expressly  mentioned 
or  not,  to  the  conclusions  contained  in  the  subsequent  portions 
of  this  Treatise.  Our  reasonings  must,  in  general,  proceed  as  if 
the  known  and  natural  effects  of  competition  were  actually  pro- 


SLAVERY 


241 


duced  by  it,  in  all  cases  in  which  it  is  not  restrained  by  some  posi¬ 
tive  obstacle.  Where  competition,  though  free  to  exist,  does  not 
exist,  or  where  it  exists,  but  has  its  natural  consequences  over¬ 
ruled  by  any  other  agency,  the  conclusions  will  fail  more  or  less 
of  being  applicable.  To  escape  error,  we  ought,  in  applying  the 
conclusions  of  political  economy  to  the  actual  affairs  of  life,  to 
consider  not  only  what  will  happen  supposing  the  maximum  of 
competition,  but  how  far  the  result  will  be  affected  if  competition 
falls  short  of  the  maximum. 

The  states  of  economical  relation  which  stand  first  in  order, 
to  be  discussed  and  appreciated,  are  those  in  which  competition 
has  no  part,  the  arbiter  of  transactions  being  either  brute  force 
or  established  usage.  These  will  be  the  subject  of  the  next  four 
chapters. 

Chapter  V. — Of  Slavery 

§  1.  Among  the  forms  which  society  assumes  under  the  in¬ 
fluence  of  the  institution  of  property,  there  are,  as  I  have  already 
remarked,  two,  otherwise  of  a  widely  dissimilar  character,  but 
resembling  in  this,  that  the  ownership  of  the  land,  the  labor,  and 
the  capital,  is  in  the  same  hands.  One  of  these  cases  is  that  of 
slavery,  the  other  is  that  of  peasant  proprietors.  In  the  one,  the 
landowner  owns  the  labor,  in  the  other  the  laborer  owns  the 
land.  We  begin  with  the  first. 

In  this  system  all  the  produce  belongs  to  the  landlord.  The 
food  and  other  necessaries  of  his  laborers  are  part  of  his  ex¬ 
penses.  The  laborers  possess  nothing  but  what  he  thinks  fit  to 
give  them,  and  until  he  thinks  fit  to  take  it  back:  and  they 
work  as  hard  as  he  chooses,  or  is  able,  to  compel  them.  Their 
wretchedness  is  only  limited  by  his  humanity,  or  his  pecuniary 
interest.  With  the  first  consideration,  we  have  on  the  present 
occasion  nothing  to  do.  What  the  second  in  so  detestable  a  con¬ 
stitution  of  society  may  dictate,  depends  on  the  facilities  for  im¬ 
porting  fresh  slaves.  If  full-grown  able-bodied  slaves  can  be 
procured  in  sufficient  numbers,  and  imported  at  a  moderate  ex¬ 
pense,  self-interest  will  recommend  working  the  slaves  to  death, 
and  replacing  them  by  importation,  in  preference  to  the  slow  and 
expensive  process  of  breeding  them.  Nor  are  the  slave-owners 
generally  backward  in  learning  this  lesson.  It  is  notorious  that 
such  was  the  practice  in  our  slave  colonies,  while  the  slave  trade 
was  legal ;  and  it  is  said  to  be  so  still  in  Cuba. 

Vol.  I.— 16 


242 


POLITICAL  ECONOMY 


When,  as  among  the  ancients,  the  slave-market  could  only  be 
supplied  by  captives  either  taken  in  war,  or  kidnapped  from 
thinly  scattered  tribes  on  the  remote  confines  of  the  known 
world,  it  was  generally  more  profitable  to  keep  up  the  number 
by  breeding,  which  necessitates  a  far  better  treatment  of  them; 
and  for  this  reason,  joined  with  several  others,  the  condition  of 
slaves,  notwithstanding  occasional  enormities,  was  probably 
much  less  bad  in  the  ancient  world  than  in  the  colonies  of  mod¬ 
ern  nations.  The  Helots  are  usually  cited  as  the  type  of  the  most 
hideous  form  of  personal  slavery,  but  with  how  little  truth,  ap¬ 
pears  from  the  fact  that  they  were  regularly  armed  (though  not 
with  the  panoply  of  the  hoplite)  and  formed  an  integral  part  of 
the  military  strength  of  the  State.  They  were  doubtless  an  in¬ 
ferior  and  degraded  caste,  but  their  slavery  seems  to  have  been 
one  of  the  least  onerous  varieties  of  serfdom.  Slavery  appears 
in  far  more  frightful  colors  among  the  Romans,  during  the  period 
in  which  the  Roman  aristocracy  was  gorging  itself  with  the 
plunder  of  a  newly  conquered  world.  The  Romans  were  a  cruel 
people,  and  the  worthless  nobles  sported  with,  the  lives  of  their 
myriads  of  slaves  with  the  same  reckless  prodigality  with  which 
they  squandered  any  other  part  of  their  ill-acquired  possessions. 
Yet,  slavery  is  divested  of  one  of  its  worst  features  when  it  is 
compatible  with  hope:  enfranchisement  was  easy  and  common: 
enfranchised  slaves  obtained  at  once  the  full  right  of  citizens, 
and  instances  were  frequent  of  their  acquiring  not  only  riches, 
but  latterly  even  honors.  By  the  progress  of  milder  legislation 
under  the  Emperors,  much  of  the  protection  of  law  was  thrown 
round  the  slave,  he  became  capable  of  possessing  property,  and 
the  evil  altogether  assumed  a  considerably  gentler  aspect.  Until, 
however,  slavery  assumes  the  mitigated  form  of  villanage,  in 
which  not  only  the  slaves  have  property  and  legal  rights,  but 
their  obligations  are  more  or  less  limited  by  usage,  and  they 
partly  labor  for  their  own  benefit;  their  condition  is  seldom  such 
as  to  produce  a  rapid  growth  either  of  population  or  of  produc¬ 
tion. 

§  2.  So  long  as  slave  countries  are  underpeopled  in  proportion 
to  their  cultivable  land,  the  labor  of  the  slaves,  under  any  toler¬ 
able  management,  produces  much  more  than  is  sufficient  for 
their  support ;  especially  as  the  great  amount  of  superintendence 
which  their  labor  requires,  preventing  the  dispersion  of  the  pop¬ 
ulation,  insures  some  of  the  advantages  of  combined  labor. 


SLAVERY 


243 


Hence,  in  a  good  soil  and  climate,  and  with  reasonable  care  of 
his  own  interests,  the  owner  of  many  slaves  has  the  means  of 
being  rich.  The  influence,  however,  of  such  a  state  of  society 
on  production,  is  perfectly  well  understood.  It  is  a  truism  to 
assert,  that  labor  extorted  by  fear  of  punishment  is  inefficient 
and  unproductive.  It  is  true  that  in  some  circumstances,  human 
beings  can  be  driven  by  the  lash  to  attempt,  and  even  to  accom¬ 
plish,  things  which  they  would  not  have  undertaken  for  any 
payment  which  it  could  have  been  worth  while  to  an  employer 
to  offer  them.  And  it  is  likely  that  productive  operations  which 
require  much  combination  of  labor,  the  production  of  sugar  for 
example,  would  not  have  taken  place  so  soon  in  the  American 
colonies,  if  slavery  had  not  existed  to  keep  masses  of  labor  to¬ 
gether.  There  are  also  savage  tribes  so  averse  from  regular  in¬ 
dustry,  that  industrial  life  is  scarcely  able  to  introduce  itself 
among  them  until  they  are  either  conquered  and  made  slaves  of, 
or  become  conquerors  and  make  others  so.  But  after  allowing 
the  full  value  of  these  considerations,  it  remains  certain  that 
slavery  is  incompatible  with  any  high  state  of  the  arts  of  life,  and 
any  great  efficiency  of  labor.  For  all  products  which  require 
much  skill,  slave  countries  are  usually  dependent  on  foreigners. 
Hopeless  slavery  effectually  brutifies  the  intellect;  and  intelli¬ 
gence  in  the  slaves,  though  often  encouraged  in  the  ancient 
world  and  in  the  East,  is  in  a  more  advanced  state  of  society  a 
source  of  so  much  danger  and  an  object  of  so  much  dread  to  the 
masters,  that  in  some  of  the  States  of  America  it  is  a  highly  penal 
offence  to  teach  a  slave  to  read.  All  processes  carried  on  by 
slave  labor  are  conducted  in  the  rudest  and  most  unimproved 
manner.  And  even  the  animal  strength  of  the  slave  is,  on  an 
average,  not  half  exerted.  The  unproductiveness  and  wasteful¬ 
ness  of  the  industrial  system  in  the  Slave  States  are  instructively 
displayed  in  the  valuable  writings  of  Mr.  Olmsted.  The  mildest 
form  of  slavery  is  certainly  the  condition  of  the  serf,  who  is  at¬ 
tached  to  the  soil,  supports  himself  from  his  allotment,  and  works 
a  certain  number  of  days  in  the -week  for  his  lord.  Yet  there  is 
but  one  opinion  on  the  extreme  inefficiency  of  serf  labor.  The 
following  passage  is  from  Professor  Jones,*  whose  “  Essay  on 
the  Distribution  of  Wealth  ”  (or  rather  on  Rent),  is  a  copious 
repertory  of  valuable  facts  on  the  landed  tenures  of  different 
countries: 

*  “  Essay  on  the  Distribution  of  Wealth  and  on  the  Sources  of  Taxation.”  By 
the  Rev.  Richard  Jones.  Page  50. 


244 


POLITICAL  ECONOMY 


“  The  Russians,  or  rather  those  German  writers  who  have 
observed  the  manners  and  habits  of  Russia,  state  some  strong 
facts  on  this  point.  Two  Middlesex  mowers,  they  say,  will  mow 
in  a  day  as  much  grass  as  six  Russian  serfs,  and  in  spite  of  the 
dearness  of  provisions  in  England  and  their  cheapness  in  Rus¬ 
sia,  the  mowing  a  quantity  of  hay  which  would  cost  an  English 
farmer  half  a  copeck,  will  cost  a  Russian  proprietor  three  or  four 
copecks.*  The  Prussian  counsellor  of  state,  Jacob,  is  considered 
to  have  proved,  that  in  Russia,  where  everything  is  cheap,  the 
labor  of  a  serf  is  doubly  as  expensive  as  that  of  a  laborer  in  Eng¬ 
land.  M.  Schmalz  gives  a  startling  account  of  the  unproductive¬ 
ness  of  serf  labor  in  Prussia,  from  his  own  knowledge  and  ob¬ 
servation.!  In  Austria,  it  is  distinctly  stated,  that  the  labor  of  a 
serf  is  equal  to  only  one-third  of  that  of  a  free  hired  laborer.  This 
calculation,  made  in  an  able  work  on  agriculture  (with  some  ex¬ 
tracts  from  which  I  have  been  favored),  is  applied  to  the  practi¬ 
cal  purpose  of  deciding  on  the  number  of  laborers  necessary  to 
cultivate  an  estate  of  a  given  magnitude.  So  palpable,  indeed, 
are  the  ill  effects  of  labor  rents  on  the  industry  of  the  agricultural 
population,  that  in  Austria  itself,  where  proposals  of  changes  of 
any  kind  do  not  readily  make  their  way,  schemes  and  plans  for 
the  commutation  of  labor  rents  are  as  popular  as  in  the  more 
stirring  German  provinces  of  the  North.”  J 

What  is  wanting  in  the  quality  of  the  labor  itself,  is  not  made 
up  by  any  excellence  in  the  direction  and  superintendence.  As 
the  same  writer  §  remarks,  the  landed  proprietors  “  are  neces¬ 
sarily,  in  their  character  of  cultivators  of  their  own  domains,  the 
only  guides  and  directors  of  the  industry  of  the  agricultural  pop¬ 
ulation,”  since  there  can  be  no  intermediate  class  of  capitalist 
farmers  where  the  laborers  are  the  property  of  the  lord.  Great 
landowners  are  everywhere  an  idle  class,  or  if  they  labor  at  all, 
addict  themselves  only  to  the  more  exciting  kinds  of  exertion; 
that  lion’s  share  which  superiors  always  reserve  for  themselves. 
“  It  would,”  as  Mr.  Jones  observes,  “  be  hopeless  and  irrational 
to  expect,  that  a  race  of  noble  proprietors,  fenced  round  with 
privileges  and  dignity,  and  attracted  to  military  and  political 

*  Schmalz,  ‘‘Economic  Politique,”  not  dared  to  take  away:  it  freed  the 

French  translation,  vol.  i.  p.  66.  peasantry  from  what  remained  of  the 

t  Vol.  ii.  p.  107.  bondage  of  serfdom,  the  labor  rents; 

t  The  Hungarian  revolutionary  gov-  decreeing  compensation  to  the  land- 

ernment,  during  its  brief  existence,  be-  lords  at  the  expense  of  the  state,  and 

stowed  on  that  country  one  of  the  great-  not  at  that  of  the  liberated  peasants, 

est  benefits  it  could  receive,  and  one  §  Jones,  pp.  53,  54. 

which  the  tyranny  that  succeeded  has 


SLAVERY 


245 


pursuits  by  the  advantages  and  habits  of  their  station*  should 
ever  become  attentive  cultivators  as  a  body.”  Even  in  England, 
if  the  cultivation  of  every  estate  depended  upon  its  proprietor, 
any  one  can  judge  what  would  be  the  result.  There  would  be 
a  few  cases  of  great  science  and  energy,  and  numerous  individ¬ 
ual  instances  of  moderate  success,  but  the  general  state  of  agri¬ 
culture  would  be  contemptible. 

§  3.  Whether  the  proprietors  themselves  would  lose  by  the 
emancipation  of  their  slaves,  is  a  different  question  from  the 
comparative  effectiveness  of  free  and  slave  labor  to  the  com¬ 
munity.  There  has  been  much  discussion  of  this  question  as  an 
abstract  thesis;  as  if  it  could  possibly  admit  of  any  universal  so¬ 
lution.  Whether  slavery  or  free  labor  is  most  profitable  to  the 
employer,  depends  on  the  wages  of  the  free  laborer.  These, 
again,  depend  on  the  numbers  of  the  laboring  population,  com¬ 
pared  with  the  capital  and  the  land.  Hired  labor  is  generally 
so  much  more  efficient  than  slave  labor,  that  the  employer  can 
pay  a  considerably  greater  value  in  wages,  than  the  maintenance 
of  his  slaves  cost  him  before,  and  yet  be  a  gainer  by  the  change: 
but  he  cannot  do  this  without  limit.  The  decline  of  serfdom  in 
Europe,  and  its  extinction  in  the  Western  nations,  were  doubt¬ 
less  hastened  by  the  changes  which  the  growth  of  population 
must  have  made  in  the  pecuniary  interests  of  the  master.  As 
population  pressed  harder  upon  the  land,  without  any  improve¬ 
ment  in  agriculture,  the  maintenance  of  the  serfs  necessarily  be¬ 
came  more  costly,  and  their  labor  less  valuable.  With  the  rate 
of  wages  such  as  it  is  in  Ireland,  or  in  England  (where,  in  pro¬ 
portion  to  its  efficiency,  labor  is  quite  as  cheap  as  in  Ireland),  no 
one  can  for  a  moment  imagine  that  slavery  could  be  profitable. 
If  the  Irish  peasantry  were  slaves,  their  masters  would  be  as 
willing,  as  their  landlords  now  are,  to  pay  large  sums  merely  to 
get  rid  of  them.  In  the  rich  and  underpeopled  soil  of  the  West 
India  islands,  there  is  just  as  little  doubt  that  the  balance  of 
profits  between  free  and  slave  labor  was  greatly  on  the  side  of 
slavery,  and  that  the  compensation  granted  to  the  slave  owners 
for  its  abolition  was  not  more,  perhaps  even  less,  than  an  equiva¬ 
lent  for  their  loss. 

More  needs  not  be  said  here  on  a  cause  so  completely  judged 
and  decided  as  that  of  slavery.  Its  demerits  are  no  longer  a 
question  requiring  argument;  though  the  temper  of  mind 
manifested  by  the  larger  part  of  the  influential  classes  in  Great 


246 


POLITICAL  ECONOMY 


Britain  respecting  the  struggle  now  taking  place  in  America, 
shows  how  grievously  the  feelings  of  the  present  generation  of 
Englishmen,  on  this  subject,  have  fallen  behind  the  positive  acts 
of  the  generation  which  preceded  them.  That  the  sons  of  the 
deliverers  of  the  West  Indian  Negroes  should  see  with  com¬ 
placency,  and  encourage  by  their  sympathies,  the  foundation  of 
a  great  and  powerful  military  commonwealth,  pledged  by  its 
principles  and  driven  by  its  strongest  interests  to  be  the  armed 
propagator  of  slavery  through  every  region  of  the  earth  into 
which  its  power  can  penetrate,  discloses  a  mental  state  in  the 
leading  portion  of  our  higher  and  middle  classes,  which  it  is 
melancholy  to  see,  and  will  be  a  lasting  blot  in  English  history. 
Fortunately  they  have  stopped  short  of  actually  aiding,  other¬ 
wise  than  by  words,  the  nefarious  enterprise  to  which  they  have 
not  been  ashamed  of  wishing  success;  and  it  is  now  probable  that 
at  the  expense  of  the  best  blood  of  the  Free  States,  but  to  their 
immeasurable  elevation  in  mental  and  moral  worth,  the  curse 
of  slavery  will  be  cast  out  from  the  great  American  republic,  to 
find  its  last  temporary  refuge  in  Brazil  and  Cuba.  No  European 
country,  except  Spain  alone,  any  longer  participates  in  the  enor¬ 
mity.  Even  serfage  has  now  ceased  to  have  a  legal  existence  in 
Europe :  Denmark  has  the  honor  of  being  the  first  Continental 
nation  which  imitated  England  in  liberating  its  colonial  slaves; 
and  the  abolition  of  slavery  was  one  of  the  earliest  acts  of  the 
heroic  and  calumniated  Provisional  Government  of  France.  The 
Dutch  Government  was  not  long  behind,  and  its  colonies  and 
dependencies  are  now,  I  believe,  without  exception,  free  from 
actual  slavery :  though  forced  labor  for  the  public  authorities  is 
still  a  recognized  institution  in  Java,  soon,  we  may  hope,  to  be 
exchanged  for  complete  personal  freedom. 


Chapter  VI. — Of  Peasant  Proprietors 

§  1.  In  the  regime  of  peasant  properties,  as  in  that  of  slavery, 
the  whole  produce  belongs  to  a  single  owner,  and  the  distinction 
of  rent,  profits,  and  wages,  does  not  exist.  In  all  other  respects, 
the  two  states  of  society  are  the  extreme  opposites  of  each  other. 
The  one  is  the  state  of  greatest  oppression  and  degradation  to 
the  laboring  class.  The  other  is  that  in  which  they  are  the  most 
uncontrolled  arbiters  of  their  own  lot. 


PEASANT  PROPRIETORS 


247 


The  advantage,  however,  of  small  properties  in  land,  is  one 
of  the  most  disputed  questions  in  the  range  of  political  economy. 
On  the  Continent,  though  there  are  some  dissentients  from  the 
prevailing  opinion,  the  benefit  of  having  a  numerous  proprietary 
population  exists  in  the  minds  of  most  people  in  the  form  of  an 
axiom.  But  English  authorities  are  either  unaware  of  the  judg¬ 
ment  of  Continental  agriculturists,  or  are  content  to  put  it  aside, 
on  the  plea  of  their  having  no  experience  of  large  properties  in 
favorable  circumstances :  the  advantage  of  large  properties  be¬ 
ing  only  felt  where  there  are  also  large  farms ;  and  as  this,  in 
arable  districts,  implies  a  greater  accumulation  of  capital  than 
usually  exists  on  the  Continent,  the  great  Continental  estates, 
except  in  the  case  of  grazing  farms,  are  mostly  let  out  for  culti¬ 
vation  in  small  portions.  There  is  some  truth  in  this ;  but  the 
argument  admits  of  being  retorted ;  for  if  the  Continent  knows 
little,  by  experience,  of  cultivation  on  a  large  scale  and  by  large 
capital,  the  generality  of  English  writers  are  no  better  ac¬ 
quainted  practically  with  peasant  proprietors,  and  have  almost 
always  the  most  erroneous  ideas  of  their  social  condition  and 
mode  of  life.  Yet  the  old  traditions  even  of  England  are  on 
the  same  side  with  the  general  opinion  of  the  Continent.  The 
“  yeomanry  ”  who  were  vaunted  as  the  glory  of  England  while 
they  existed,  and  have  been  so  much  mourned  over  since  they 
disappeared,  were  either  small  proprietors  or  small  farmers, 
and  if  they  were  mostly  the  last,  the  character  they  bore  for 
sturdy  independence  is  the  more  noticeable.  There  is  a  part  of 
England,  unfortunately  a  very  small  part,  where  peasant  pro¬ 
prietors  are  still  common ;  for  such  are  the  “  statesmen  ”  of 
Cumberland  and  Westmoreland,  though  they  pay,  I  believe, 
generally  if  not  universally,  certain  customary  dues,  which, 
being  fixed,  no  more  affect  their  character  of  proprietors  than 
the  land-tax  does.  There  is  but  one  voice,  among  those  ac¬ 
quainted  with  the  country,  on  the  admirable  effects  of  this 
tenure  of  land  in  those  counties.  No  other  agricultural  popu¬ 
lation  in  England  could  have  furnished  the  originals  of  Words¬ 
worth’s  peasantry.* 


*  In  Mr.  Wordsworth’s  little  descrip¬ 
tive  work  on  the  scenery  of  the  Lakes, 
he  speaks  of  the  upper  part  of  the  dales 
as  having  been  for  centuries  “  a  perfect 
republic  of  shepherds  and  agriculturists, 
proprietors,  for  the  most  part,  of  the 
lands  which  they  occupied  and  culti¬ 
vated.  The  plough  of  each  man  was 
confined  to  the  maintenance  of  his  own 


family,  or  to  the  occasional  accommoda¬ 
tion  of  his  neighbor.  Two  or  three  cows 
furnished  each  family  with  milk  and 
cheese.  The  chapel  was  the  only  edifice 
that  presided  over  these  dwellings,  the 
supreme  head  of  this  pure  common¬ 
wealth;  the  members  of  which  existed 
in  the  midst  of  a  powerful  empire,  like 
an  ideal  society,  or  an  organized  com- 


248 


POLITICAL  ECONOMY 


The  general  system,  however,  of  English  cultivation,  afford¬ 
ing  no  experience  to  render  the  nature  and  operation  of  peasant 
properties  familiar,  and  Englishmen  being  in  general  pro¬ 
foundly  ignorant  of  the  agricultural  economy  of  other  countries, 
the  very  idea  of  peasant  proprietors  is  strange  to  the  English 
mind,  and  does  not  easily  find  access  to  it.  Even  the  forms 
of  language  stand  in  the  way:  the  familiar  designation  for 
owners  of  land  being  “  landlords,”  a  term  to  which  “  tenants  ” 
is  always  understood  as  a  correlative.  When,  at  the  time  of 
the  famine,  the  suggestion  of  peasant  properties  as  a  means 
of  Irish  improvement  found  its  way  into  parliamentary  and 
newspaper  discussions,  there  were  writers  of  pretension  to 
whom  the  word  “  proprietor  ”  was  so  far  from  conveying  any 
distinct  idea,  that  they  mistook  the  small  holdings  of  Irish 
cottier  tenants  for  peasant  properties.  The  subject  being  so 
little  understood,  I  think  it  important,  before  entering  into  the 
theory  of  it,  to  do  something  toward  showing  how  the  case 
stands  as  a  matter  of  fact;  by  exhibiting,  at  greater  length 
than  would  otherwise  be  admissible,  some  of  the  testimony 
which  exists  respecting  the  state  of  cultivation,  and  the  com¬ 
fort  and  happiness  of  the  cultivators,  in  those  countries  and 
parts  of  countries,  in  which  the  greater  part  of  the  land  has 
neither  landlord  nor  farmer,  other  than  the  laborer  who  tills 
the  soil. 

§  2.  I  lay  no  stress  on  the  condition  of  North  America,  where, 
as  is  well  known,  the  land,  wherever  free  from  the  curse  of 
slavery,  is  almost  universally  owned  by  the  same  person  who 
holds  the  plough.  A  country  combining  the  natural  fertility  of 
America  with  the  knowledge  and  arts  of  modern  Europe,  is  so 
peculiarly  circumstanced,  that  scarcely  anything,  except  inse¬ 
curity  of  property  or  a  tyrannical  government,  could  materially 
impair  the  prosperity  of  the  industrious  classes.  I  might,  with 


munity,  whose  constitution  had  been 
imposed  and  regulated  by  the  moun¬ 
tains  which  protected  it.  Neither  high¬ 
born  nobleman,  knight,  nor  esquire  was 
here;  but  many  of  these  humble  sons  of 
the  hills  had  a  consciousness  that  the 
land  which  they  walked  over  and  tilled 
had  for  more  than  five  hundred  years 
been  possessed  by  men  of  their  name 
and  blood.  .  .  .  Corn  was  grown 
in  these  vales  sufficient  upon  each  estate 
to  furnish  bread  for  each  family,  no 
more.  The  storms  and  moisture  of  the 
climate  induced  them  to  sprinkle  their 
upland  property  with  outhouses  of  na¬ 
tive  stone,  as  places  of  shelter  for  their 


sheep,  where  in  tempestuous  weather, 
food  was  distributed  to  them.  Every 
family  spun  from  its  own  flock  the  wool 
with  which  it  was  clothed;  a  weaver  was 
here  and  there  found  among  them,  and 
the  rest  of  their  wants  was  supplied  by 
the  produce  of  the  yarn,  which  they 
carded  and  spun  in  their  own  houses, 
and  carried  to  market  either  under  their 
arms,  or  more  frequently  on  packhorses, 
a  small  train  taking  their  way  weekly 
down  the  valley,  or  over  the  mountains, 
to  the  most  commodious  town.” — “  A 
Description  of  the  Scenery  of  the  Lakes 
in  the  North  of  England,”  3d  edit.  pp. 
50  to  S3  and  63  to  65. 


PEASANT  PROPRIETORS 


249 


Sismondi,  insist  more  strongly  on  the  case  of  ancient  Italy, 
especially  Latium,  that  Campagua  which  then  swarmed  with 
inhabitants  in  the  very  regions  which  under  a  contrary  regime 
have  become  uninhabitable  from  malaria.  But  I  prefer  taking 
the  evidence  of  the  same  writer  on  things  known  to  him  by 
personal  observation. 

“  It  is  especially  Switzerland/’  says  M.  de  Sismondi,  “  which 
should  be  traversed  and  studied  to  judge  of  the  happiness  of 
peasant  proprietors.  It  is  from  Switzerland  we  learn  that  agri¬ 
culture  practised  by  the  very  persons  who  enjoy  its  fruits,  suf¬ 
fices  to  procure  great  comfort  for  a  very  numerous  population ; 
a  great  independence  of  character,  arising  from  independence 
of  position ;  a  great  commerce  of  consumption,  the  result  of  the 
easy  circumstances  of  all  the  inhabitants,  even  in  a  country 
whose  climate  is  rude,  whose  soil  is  but  moderately  fertile,  and 
where  late  frosts  and  inconstancy  of  seasons  often  blight  the 
hopes  of  the  cultivator.  It  is  impossible  to  see  without  admira¬ 
tion  those  timber  houses  of  the  poorest  peasant,  so  vast,  so  well 
closed  in,  so  covered  with  carvings.  In  the  interior,  spacious 
corridors  separate  the  different  chambers  of  the  numerous  fam¬ 
ily;  each  chamber  has  but  one  bed,  which  is  abundantly  fur¬ 
nished  with  curtains,  bedclothes,  and  the  whitest  linen ;  care¬ 
fully  kept  furniture  surrounds  it ;  the  wardrobes  are  filled  with 
linen ;  the  dairy  is  vast,  well  aired,  and  of  exquisite  cleanness ; 
under  the  same  roof  is  a  great  provision  of  corn,  salt  meat, 
cheese  and  wood ;  in  the  cow-houses  are  the  finest  and  most 
carefully  tended  cattle  in  Europe;  the  garden  is  planted  with 
flowers,  both  men  and  women  are  cleanly  and  warmly  clad, 
the  women  preserve  with  pride  their  ancient  costume ;  all  carry 
in  their  faces  the  impress  of  health  and  strength.  Let  other 
nations  boast  of  their  opulence,  Switzerland  may  always  point 
with  pride  to  her  peasants.”  * 

The  same  eminent  writer  thus  expresses  his  opinions  on  peas¬ 
ant  proprietorship  in  general : 

“  Wherever  we  find  peasant  proprietors,  we  also  find  the 
comfort,  security,  confidence  in  the  future,  and  independence, 
which  assure  at  once  happiness  and  virtue.  The  peasant  who 
with  his  children  does  all  the  work  of  his  little  inheritance,  who 
pays  no  rent  to  anyone  above  him,  nor  wages  to  anyone  below, 
who  regulates  his  production  by  his  consumption,  who  eats  his 

* "  Studies  in  Political  Economy.”  Essay  III. 


250 


POLITICAL  ECONOMY 


own  corn,  drinks  his  own  wine,  is  clothed  in  his  own  hemp  and 
wool,  cares  little  for  the  prices  of  the  market ;  for  he  has  little 
to  sell  and  little  to  buy,  and  is  never  ruined  by  revulsions  of 
trade.  Instead  of  fearing  for  the  future,  he  sees  it  in  the 
colors  of  hope ;  for  he  employs  every  moment  not  required  by 
the  labors  of  the  year,  on  something  profitable  to  his  children 
and  to  future  generations.  A  few  minutes’  work  suffices  him 
to  plant  the  seed  which  in  a  hundred  years  will  be  a  large  tree, 
to  dig  the  channel  which  will  conduct  to  him  a  spring  of  fresh 
water,  to  improve  by  cares  often  repeated,  but  stolen  from  odd 
times,  all  the  species  of  animals  and  vegetables  which  surround 
him.  His  little  patrimony  is  a  true  savings  bank,  always  ready 
to  receive  all  his  little  gains  and  utilize  all  his  moments  of  leisure. 
The  ever-acting  power  of  nature  returns  them  a  hundredfold. 
The  peasant  has  a  lively  sense  of  the  happiness  attached  to  the 
condition  of  a  proprietor.  Accordingly  he  is  always  eager  to 
buy  land  at  any  price.  He  pays  more  for  it  than  its  value,  more 
perhaps  than  it  will  bring  him  in ;  but  is  he  not  right  in  esti¬ 
mating  highly  the  advantage  of  having  always  an  advantageous 
investment  for  his  labor,  without  underbidding  in  the  wages 
market— of  being  always  able  to  find  bread,  without  the  neces¬ 
sity  of  buying  it  at  a  scarcity  price  ? 

“  The  peasant  proprietor  is  of  all  cultivators  the  one  who 
gets  most  from  the  soil,  for  he  is  the  one  who  thinks  most  of 
the  future,  and  who  has  been  most  instructed  by  experience. 
He  is  also  the  one  who  employs  the  human  powers  to  most 
advantage,  because  dividing  his  occupations  among  all  the 
members  of  his  family,  he  reserves  some  for  every  day  of  the 
year,  so  that  nobody  is  ever  out  of  work.  Of  all  cultivators 
he  is  the  happiest,  and  at  the  same  time  the  land  nowhere  oc¬ 
cupies,  and  feeds  amply  without  becoming  exhausted,  so  many 
inhabitants  as  where  they  are  proprietors.  Finally,  of  all  culti¬ 
vators  the  peasant  proprietor  is  the  one  who  gives  most  encour¬ 
agement  to  commerce  and  manufactures,  because  he  is  the 
richest.”  * 

*  And  in  another  work  (“  New  Princi¬ 
ples  of  Political  Economy,”  book  iii. 
chap.  3)  he  says:  “  When  we  traverse 
nearly  the  whole  of  Switzerland,  and 
several  provinces  of  France,  Italy,  and 
Germany,  we  need  never  ask,  in  looking 
at  any  piece  of  land,  if  it  belongs  to  a 
peasant  proprietor  or  to  a  farmer.  The 
intelligent  care,  the  enjoyments  provided 
for  the  laborer,  the  adornment  which 
the  country  has  received  from  his  hands, 


are  clear  indications  of  the  former.  It 
is  true  an  oppressive  government  may 
destroy  the  comfort  and  brutify  the  in¬ 
telligence  which  should  be  the  result  of 
property;  taxation  may  abstract  the  best 
produce  of  the  fields,  the  insolence  of 
government  officers  may  disturb  the 
security  of  the  peasant,  the  impossi¬ 
bility  of  obtaining  justice  against  a  pow¬ 
erful  neighbor  may  sow  discouragement 
in  his  mind,  and  in  the  fine  country 


PEASANT  PROPRIETORS 


251 


This  picture  of  unwearied  assiduity,  and  what  may  be  called 
affectionate  interest  in  the  land,  is  borne  out  in  regard  to  the 
more  intelligent  Cantons  of  Switzerland  by  English  observers. 
“  In  walking  anywhere  in  the  neighborhood  of  Zurich,”  says 
Mr.  Inglis,  “  in  looking  to  the  right  or  to  the  left,  one  is  struck 
with  the  extraordinary  industry  of  the  inhabitants ;  and  if  we 
learn  that  a  proprietor  here  has  a  return  of  ten  per  cent.,  we 
are  inclined  to  say,  ‘  he  deserves  it.’  I  speak  at  present  of  coun¬ 
try  labor,  though  I  believe  that  in  every  kind  of  trade  also,  the 
people  of  Zurich  are  remarkable  for  their  assiduity ;  but  in  the 
industry  they  show  in  the  cultivation  of  their  land  I  may  safely 
say  they  are  unrivalled.  When  I  used  to  open  my  casement 
between  four  and  five  in  the  morning  to  look  out  upon  the  lake 
and  the  distant  Alps,  I  saw  the  laborer  in  the  fields ;  and  when 
I  returned  from  an  evening  walk,  long  after  sunset,  as  late, 
perhaps,  as  half-past  eight,  there  was  the  laborer,  mowing  his 
grass,  or  tying  up  his  vines.  .  .  .  It  is  impossible  to  look  at 
a  field,  a  garden,  a  hedging,  scarcely  even  a  tree,  a  flower,  or 
a  vegetable,  without  perceiving  proofs  of  the  extreme  care  and 
industry  that  are  bestowed  upon  the  cultivation  of  the  soil. 
If,  for  example,  a  path  leads  through  or  by  the  side  of  a  field 
of  grain,  the  corn  is  not,  as  in  England,  permitted  to  hang  over 
the  path,  exposed  to  be  pulled  or  trodden  down  by  every  passer¬ 
by;  it  is  everywhere  bounded  by  a  fence,  stakes  are  placed  at 
intervals  of  about  a  yard,  and,  about  two  or  three  feet  from 
the  ground,  boughs  of  trees  are  passed  longitudinally  along.  If 
you  look  into  a  field  toward  evening,  where  there  are  large  beds 
of  cauliflower  or  cabbage,  you  will  find  that  every  single  plant 
has  been  watered.  In  the  gardens,  which  around  Zurich  are 
extremely  large,  the  most  punctilious  care  is  evinced  in  every 
production  that  grows.  The  vegetables  are  planted  with  seem¬ 
ingly  mathematical  accuracy;  not  a  single  weed  is  to  be  seen, 
not  a  single  stone.  Plants  are  not  earthed  up  as  with  us,  but 
are  planted  in  a  small  hollow,  into  each  of  which  a  little  manure 
is  put,  and  each  plant  is  watered  daily.  Where  seeds  are  sown, 
the  earth  directly  above  is  broken  into  the  finest  powder ;  every 
shrub,  every  flower  is  tied  to  a  stake,  and  where  there  is  wall- 


which  has  been  given  bach  to  the  ad¬ 
ministration  of  the  King  of  Sardinia,  the 
proprietor,  equally  with  the  day-laborer, 
wears  the  livery  of  indigence.”  He  was 
here  speaking  of  Savoy,  where  the  peas¬ 
ants  were  generally  proprietors*  and*  ac¬ 


cording  to  authentic  accounts,  extremely 
miserable.  But,  as  M.  de  Sismondi  con¬ 
tinues,  “  it  is  in  vain  to  observe  only 
one  of  the  rules  of  political  economy;  it 
cannot  by  itself  suffice  to  produce  good:, 
but  at  least  it  diminishes  evil.” 


252 


POLITICAL  ECONOMY 


fruit,  a  trellis  is  erected  against  the  wall,  to  which  the  boughs 
are  fastened,  and  there  is  not  a  single  thing  that  has  not  its 
appropriate  resting-place.”  * 

Of  one  of  the  remote  valleys  of  the  High  Alps  the  same  writer 
thus  expresses  himself :  \ 

“  In  the  whole  of  the  Engadine  the  land  belongs  to  the  peas¬ 
antry,  who,  like  the  inhabitants  of  every  other  place  where  this 
state  of  things  exist,  vary  greatly  in  the  extent  of  their  posses¬ 
sions.  .  .  .  Generally  speaking,  an  Engadine  peasant  lives 
entirely  upon  the  produce  of  his  land,  with  the  exception  of 
the  few  articles  of  foreign  growth  required  in  his  family,  such 
as  coffee,  sugar,  and  wine.  Flax  is  grown,  prepared,  spun,  and 
woven,  without  ever  leaving  his  house.  He  has  also  his  own 
wool,  which  is  converted  into  a  blue  coat  without  passing 
through  the  hands  of  either  the  dyer  or  the  tailor.  The  country 
is  incapable  of  greater  cultivation  than  it  has  received.  All  has 
been  done  for  it  that  industry  and  an  extreme  love  of  gain  can 
devise.  There  is  not  a  foot  of  waste  land  in  the  Engadine,  the 
lowest  part  of  which  is  not  much  lower  than  the  top  of  Snow¬ 
don.  Wherever  grass  will  grow,  there  it  is ;  wherever  a  rock 
will  bear  a  blade,  verdure  is  seen  upon  it;  wherever  an  ear 
of  rye  will  ripen,  there  it  is  to  be  found.  Barley  and  oats  have 
also  their  appropriate  spots ;  and  wherever  it  is  possible  to  ripen 
a  little  patch  of  wheat,  the  cultivation  of  it  is  attempted.  In  no 
country  in  Europe  will  be  found  so  few  poor  as  in  the  Engadine. 
In  the  village  of  Suss,  which  contains  about  six  hundred  inhabi¬ 
tants,  there  is  not  a  single  individual  who  has  not  wherewithal 
to  live  comfortably,  not  a  single  individual  who  is  indebted  to 
others  for  one  morsel  that  he  eats.” 

Notwithstanding  the  general  prosperity  of  the  Swiss  peas¬ 
antry,  this  total  absence  of  pauperism,  and  (it  may  almost  be 
said)  of  poverty,  cannot  be  predicated  of  the  whole  country; 
the  largest  and  richest  canton,  that  of  Berne,  being  an  example 
of  the  contrary;  for  although,  in  the  parts  of  it  which  are 
occupied  by  peasant  proprietors,  their  industry  is  as  remark¬ 
able  and  their  ease  and  comfort  as  conspicuous  as  elsewhere, 
the  canton  is  burdened  with  a  numerous  pauper  population, 
through  the  operation  of  the  worst  regulated  system  of  poor- 
law  administration  in  Europe,  except  that  of  England  before 

*  “  Switzerland,  the  South  of  France,  and  the  Pyrenees  in  1830.”  By  H.  D. 
Inglis.  Vol.  i.  chap.  2.  f  Ibid,  chaps.  8  and  10. 


PEASANT  PROPRIETORS 


253 


the  new  Poor  Law.*  Nor  is  Switzerland  in  some  other  re¬ 
spects  a  favorable  example  of  all  that  peasant  properties  might 
effect.  There  exists  a  series  of  statistical  accounts  of  the  Swiss 
cantons,  drawn  up  mostly  with  great  care  and  intelligence,  con¬ 
taining  detailed  information,  of  tolerably  recent  date,  respecting 
the  condition  of  the  land  and  of  the  people.  From  these,  the 
subdivision  appears  to  be  often  so  minute,  that  it  can  hardly 
be  supposed  not  to  be  excessive :  and  the  indebtedness  of  the 
proprietors  in  the  flourishing  canton  of  Zurich  “borders,”  as 
the  writer  expresses  it,  “  on  the  incredible  ” ;  so  that  “  only 
the  intensest  industry,  frugality,  temperance,  and  complete 
freedom  of  commerce  enable  them  to  stand  their  ground.”  f 
Yet  the  general  conclusion  deducible  from  these  books  is  that 
since  the  beginning  of  the  century,  and  concurrently  with  the 
subdivision  of  many  great  estates  which  belonged  to  nobles 
or  to  the  cantonal  governments,  there  has  been  a  striking  and 
rapid  improvement  in  almost  every  department  of  agriculture, 
as  well  as  in  the  houses,  the  habits,  and  the  food  of  the  people. 
The  writer  of  the  account  of  Thiirgau  goes  so  far  as  to  say, 
that  since  the  subdivision  of  the  feudal  estates  into  peasant 
properties,  it  is  not  uncommon  for  a  third  or  a  fourth  part  of  an 
estate  to  produce  as  much  grain,  and  support  as  many  head  of 
cattle,  as  the  whole  estate  did  before. | 

§  3.  One  of  the  countries  in  which  peasant  proprietors  are 
of  oldest  date,  and  most  numerous  in  proportion  to  the  popula¬ 
tion,  is  Norway.  Of  the  social  and  economical  condition  of 
that  country  an  interesting  account  has  been  given  by  Mr. 
Laing.  His  testimony  in  favor  of  small  landed  properties  both 
there  and  elsewhere,  is  given  with  great  decision.  I  shall  quote 
a  few  passages. 

“If  small  proprietors  are  not  good  farmers,  it  is  not  from 
the  same  cause  here  which  we  are  told  makes  them  so  in  Scot- 


*  There  have  been  considerable  changes 
in  the  Poor  Law  administration  and  leg¬ 
islation  of  the  Canton  of  Berne  since 
the  sentence  in  the  text  was  written. 
But  I  am  not  sufficiently  acquainted 
with  the  nature  and  operation  of  these 
changes,  to  speak  more  particularly  of 
them  here. 

t  “  Historical,  Geographical,  and  Sta¬ 
tistical  Picture  of  Switzerland.”  Part 
I.  Canton  of  Zurich.  By  Gerold  Meyer 
Von  Knonau,  1834,  pp.  80,  81.  There  are 
villages  in  Zurich,  he  adds,  in  which 
there  is  not  a  single  property  unmort¬ 
gaged.  It  does  not,  however,  follow 


that  each  individual  proprietor  is  deeply 
involved  because  the  aggregate  mass  of 
incumbrances  is  large.  In  the  Canton 
of  Schaffhausen,  for  instance,  it  is  stated 
that  the  landed  properties  are  almost  all 
mortgaged,  but  rarely  for  more  than 
one-half  their  registered  value.  (Part 
XII.  Canton  of  Schaffhausen,  by  Ed¬ 
ward  Im-Thurn,  1840,  p.  52),  and  the 
mortgages  are  often  for  the  improve¬ 
ment  and  enlargement  of  the  estate. 
(Part  XVII.  Canton  of  Thiirgau,  by 
J.  A.  Pupikofer,  1837,  p.  209.) 

t  “  Thiirgau,”  p.  72. 


254 


POLITICAL  ECONOMY 


land — indolence  and  want  of  exertion.  The  extent  to  which 
irrigation  is  carried  on  in  these  glens  and  valleys  shows  a  spirit 
of  exertion  and  co-operation  ”  (I  request  particular  attention 
to  this  point),  “  to  which  the  latter  can  show  nothing  similar. 
Hay  being  the  principal  winter  support  of  live  stock,  and  both 
it  and  corn,  as  well  as  potatoes,  liable,  from  the  shallow  soil 
and  powerful  reflection  of  sunshine  from  the  rocks,  to  be  burnt 
and  withered  up,  the  greatest  exertions  are  made  to  bring  water 
from  the  head  of  each  glen,  along  such  a  level  as  will  give  the 
command  of  it  to  each  farmer  at  the  head  of  his  fields.  This 
is  done  by  leading  it  in  wooden  troughs  (the  half  of  a  tree 
roughly  scooped)  from  the  highest  perennial  stream  among  the 
hills,  through  woods,  across  ravines,  along  the  rocky,  often  per¬ 
pendicular,  sides  of  the  glens,  and  from  this  main  trough  giving 
a  lateral  one  to  each  farmer  in  passing  the  head  of  his  farm. 
He  distributes  this  supply  by  movable  troughs  among  his  fields ; 
and  at  this  season  waters  each  rig  successively  with  scoops  like 
those  used  by  bleachers  in  watering  cloth,  laying  his  trough 
between  every  two  rigs.  One  would  not  believe,  without  seeing 
it,  how  very  large  an  extent  of  land  is  traversed  expeditiously 
by  these  artificial  showers.  The  extent  of  the  main  troughs  is 
very  great.  In  one  glen  I  walked  ten  miles,  and  found  it 
troughed  on  both  sides :  on  one,  the  chain  is  continued  down 
the  main  valley  for  forty  miles.*  Those  may  be  bad  farmers 
who  do  such  things ;  but  they  are  not  indolent,  nor  ignorant 
of  the  principle  of  working  in  concert,  and  keeping  up  estab¬ 
lishments  for  common  benefit.  They  are  undoubtedly,  in  these 
respects,  far  in  advance  of  any  community  of  cottars  in  our 
Highland  glens.  They  feel  as  proprietors,  who  receive  the 
advantage  of  their  own  exertions.  The  excellent  state  of  the 
roads  and  bridges  is  another  proof  that  the  country  is  inhabited 
by  people  who  have  a  common  interest  to  keep  them  under 
repair.  There  are  no  tolls.”  f 


*  Reichensperger  (“  The  Land  Ques¬ 
tion  ”)  quoted  by  Mr.  Kay  (“  Social 
Condition  and  Education  of  the  People 
in  England  and  Europe  ”),  observes, 
“  that  the  parts  of  Europe  where  the 
most  extensive  and  costly  plans  for 
watering  the  meadows  and  lands  have 
been  carried  out  in  the  greatest  perfec¬ 
tion,  are  those  where  the  lands  are  very 
much  subdivided,  and  are  in  the  hands 
of  small  proprietors.  He  instances  the 
plain  round  Valencia,  several  of  the 
southern  departments  of  France,  par¬ 
ticularly  those  of  Vaucluse  and  Bouches 
du  Rhone,  Lombardy,  Tuscany,  the  dis¬ 


tricts  of  Sienna,  Lucca,  and  Bergamo, 
Piedmont,  many  parts  of  Germany,  etc., 
in  all  which  parts  of  Europe  the  land  is 
very  much  subdivided  among  small  pro¬ 
prietors.  In  all  these  parts  great  and 
expensive  systems  and  plans  of  general 
irrigation  have  been  carried  out,  and  are 
now  being  supported,  by  the  small  pro¬ 
prietors  themselves;  thus  showing  how 
they  are  able  to  accomplish,  by  means 
of  combination,  work  requiring  the  ex¬ 
penditure  of  great  quantities  of  capital.” 
— Kay,  i.  126. 

t  Laing,  “  Journal  of  a  Residence  in 
Norway,”  pp.  36,  37. 


PEASANT  PROPRIETORS 


255 

On  the  effects  of  peasant  proprietorship  on  the  Continent 
generally,  the  same  writer  expresses  himself  as  follows  :  * 

“If  we  listen  to  the  large  farmer,  the  scientific  agricultur¬ 
ist,  the  ”  [English]  “  political  economist,  good  farming  must 
perish  with  large  farms ;  the  very  idea  that  good  farming  can 
exist,  unless  on  large  farms  cultivated  with  great  capital,  they 
hold  to  be  absurd.  Draining,  manuring,  economical  arrange¬ 
ment,  cleaning  the  land,  regular  rotations,  valuable  stock  and 
implements,  all  belong  exclusively  to  large  farms,  worked  by 
large  capital,  and  by  hired  labor.  This  reads  very  well ;  but 
if  we  raise  our  eyes  from  their  books  to  their  fields,  and  coolly 
compare  what  we  seen  in  the  best  districts  farmed  in  large 
farms,  with  what  we  see  in  the  best  districts  farmed  in  small 
farms,  we  see,  and  there  is  no  blinking  the  fact,  better  crops 
on  the  ground  in  Flanders,  East  Friesland,  Holstein,  in  short, 
on  the  whole  line  of  the  arable  land  of  equal  quality  on  the 
Continent,  from  the  Sound  to  Calais,  than  we  see  on  the  line 
of  British  coast  opposite  to  this  line,  and  in  the  same  latitudes, 
from  the  Frith  of  Forth  all  round  to  Dover.  Minute  labor  on 
small  portions  of  arable  ground  gives  evidently,  in  equal  soils 
and  climate,  a  superior  productiveness,  where  these  small  por¬ 
tions  belong  in  property,  as  in  Flanders,  Holland,  Friesland, 
and  Ditmarsch  in  Holstein,  to  the  farmer.  It  is  not  pretended 
by  our  agricultural  writers,  that  our  large  farmers,  even  in 
Berwickshire,  Roxburghshire,  or  the  Lothians,  approach  to 
the  garden-like  cultivation,  attention  to  manures,  drainage,  and 
clean  state  of  the  land,  or  in  productiveness  from  a  small  space 
of  soil  not  originally  rich,  which  distinguish  the  small  farmers 
of  Flanders,  or  their  system.  In  the  best  farmed  parish  in  Scot¬ 
land  or  England,  more  land  is  wasted  in  the  corners  and  bor¬ 
ders  of  the  fields  of  large  farms,  in  the  roads  through  them, 
unnecessarily  wide  because  they  are  bad,  and  bad  because  they 
are  wide,  in  neglected  commons,  waste  spots,  useless  belts  and 
clumps  of  sorry  trees,  and  such  unproductive  areas,  than  would 
maintain  the  poor  of  the  parish,  if  they  were  all  laid  together 
and  cultivated.  But  large  capital  applied  to  farming  is  of  course 
only  applied  to  the  very  best  of  the  soils  of  a  country.  It  cannot 
touch  the  small  unproductive  spots  which  require  more  time 
and  labor  to  fertilize  them  than  is  consistent  with  a  quick  return 
of  capital.  But  although  hired  time  and  labor  cannot  be  applied 


*  “  Notes  of  a  Traveller,”  pp.  299  et  seqq. 


256 


POLITICAL  ECONOMY 


beneficially  to  such  cultivation,  the  owner’s  own  time  and  labor 
may.  He  is  working  for  no  higher  terms  at  first  from  his  land 
than  a  bare  living.  But  in  the  course  of  generations  fertility 
and  value  are  produced;  a  better  living,  and  even  very  im¬ 
proved  processes  of  husbandry,  are  attained.  Furrow  draining, 
stall  feeding  all  summer,  liquid  manures,  are  universal  in  the 
husbandry  of  the  small  farms  of  Flanders,  Lombardy,  Switzer¬ 
land.  Our  most  improving  districts  under  large  farms  are  but 
beginning  to  adopt  them.  Dairy  husbandry  even,  and  the 
manufacture  of  the  largest  cheeses  by  the  co-operation  of  many 
small  farmers,*  the  mutual  assurance  of  property  against  fire 
and  hail-storms,  by  the  co-operation  of  small  farmers — the  most 
scientific  and  expensive  of  all  agricultural  operations  in  modern 
times,  the  manufacture  of  beet-root  sugar — the  supply  of  the 
European  markets  with  flax  and  hemp,  by  the  husbandry  of 
small  farmers — the  abundance  of  legumes,  fruits,  poultry,  in 
the  usual  diet  even  of  the  lowest  classes  abroad,  and  the  total 
want  of  such  variety  at  the  tables  even  of  our  middle  classes, 
and  this  variety  and  abundance  essentially  connected  with  the 
husbandry  of  small  farmers — all  these  are  features  in  the  occu¬ 
pation  of  a  country  by  small  proprietor-farmers,  which  must 
make  the  inquirer  pause  before  he  admits  the  dogma  of  our 
land  doctors  at  home,  that  large  farms  worked  by  hired  labor 
and  great  capital  can  alone  bring  out  the  greatest  productive¬ 
ness  of  the  soil  and  furnish  the  greatest  supply  of  the  necessaries 
and  conveniences  of  life  to  the  inhabitants  of  a  country.” 

§  4.  Among  the  many  flourishing  regions  of  Germany  in 
which  peasant  properties  prevail,  I  select  the  Palatinate,  for  the 
advantage  of  quoting,  from  an  English  source,  the  results  of 
recent  personal  observation  of  its  agriculture  and  its  people. 


*  The  manner  in  which  the  Swiss 
peasants  combine  to  carry  on  cheese¬ 
making  by  their  united  capital  deserves 
to  be  noted:  “  Each  parish  in  Switzer¬ 
land  hires  a  man,  generally  from  the 
district  of  Gruyere  in  the  canton  of 
Freyburg,  to  take  care  of  the  herd,  and 
make  the  cheese.  One  cheeseman,  one 
pressman  or  assistant,  and  one  cowherd, 
are  considered  necessary  for  every  forty 
cows.  The  owners  of  the  cows  get 
credit  each  of  them,  in  a  book  daily,  for 
the  quantity  of  milk  given  by  each  cow. 
The  cheeseman  and  his  assistants  milk 
the  cows,  put  the  milk  all  together,  and 
make  cheese  of  it,  and  at  the  end  of  th; 
season  each  owner  receives  the  weight 
of  cheese  proportionable  to  the  quantity 
of  milk  his  cows  have  delivered.  By 
this  co-operative  plan,  instead  of  the 


small-sized  unmarketable  cheeses  only, 
which  each  could  produce  out  of  his 
three  or  four  cows’  milk,  he  has  the 
same  weight  >n  large  marketable  cheese 
superior  in  quality,  because  made  by 
people  who  attend  to  no  other  business. 
The  cheeseman  and  his  assistants  are 
paid  so  much  per  head  of  the  cows,  in 
money  or  in  cheese,  or  sometimes  they 
hire  the  cows,  and  pay  the  owners  in 
money  or  cheese.” — “  Notes  of  a  Trav¬ 
eller,”  p.  351.  A  similar  system  exist? 
in  the  French  Jura.  See,  for  full  details, 
Lavergne,  “  Rural  Economy  of  France,” 
2d  ed.,  pp.  139  et  seqq.  One .  of  the 
most  remarkable  points  in  this  interest¬ 
ing  case  of  combination  of  labor,  is  the 
confidence  which  it  supposes,  and  which 
experience  must  justify  in  the  integrity 
of  the  persons  employed. 


PEASANT  PROPRIETORS 


257 


Mr.  Howitt,  a  writer  whose  habit  it  is  to  see  all  English  objects 
and  English  socialities  on  their  brightest  side,  and  who,  in  treat¬ 
ing  of  the  Rhenish  peasantry,  certainly  does  not  underrate  the 
rudeness  of  their  implements,  and  the  inferiority  of  their  plough¬ 
ing,  nevertheless  shows  that  under  the  invigorating  influence 
of  the  feelings  of  proprietorship,  they  make  up  for  the  imper¬ 
fections  of  their  apparatus  by  the  intensity  of  their  application. 
“  The  peasant  harrows  and  clears  his  land  till  it  is  in  the  nicest 
order,  and  it  is  admirable  to  see  the  crops  which  he  obtains.”  * 
“  The  peasants  f  are  the  great  and  ever-present  objects  of  coun¬ 
try  life.  They  are  the  great  population  of  the  country,  because 
they  themselves  are  the  possessors.  This  country  is,  in  fact, 
for  the  most  part,  in  the  hands  of  the  people.  It  is  parcelled 
out  among  the  multitude.  .  .  .  The  peasants  are  not,  as 

with  us,  for  the  most  part,  totally  cut  off  from  property  in  the 
soil  they  cultivate,  totally  dependent  on  the  labor  afforded  by 
others — they  are  themselves  the  proprietors.  It  is,  perhaps, 
from  this  cause  that  they  are  probably  the  most  industrious 
peasantry  in  the  world.  They  labor  busily,  early  and  late,  be¬ 
cause  they  feel  that  they  are  laboring  for  themselves.  .  .  . 

The  German  peasants  work  hard,  but  they  have  no  actual  want. 
Every  man  has  his  house,  his  orchard,  his  roadside  trees,  com¬ 
monly  so  heavy  with  fruit,  that  he  is  obliged  to  prop  and  secure 
them  all  ways,  or  they  would  be  torn  to  pieces.  He  has  his 
corn-plot,  his  plot  for  mangel-wurzel,  for  hemp,  and  so  on.  He 
is  his  own  master;  and  he,  and  every  member  of  his  family, 
have  the  strongest  motives  to  labor.  You  see  the  effect  of  this 
in  that  unremitting  diligence  which  is  beyond  that  of  the  whole 
world  besides,  and  his  economy,  which  is  still  greater.  The 
Germans,  indeed,  are  not  so  active  and  lively  as  the  English. 
You  never  see  them  in  a  bustle,  or  as  though  they  meant  to 
knock  off  a  vast  deal  in  a  little  time.  .  .  .  They  are,  on  the 
contrary,  slow,  but  forever  doing.  They  plod  on  from  day  to 
day,  and  year  to  year — the  most  patient,  untirable,  and  perse¬ 
vering  of  animals.  The  English  peasant  is  so  cut  off  from 
the  idea  of  property,  that  he  comes  habitually  to  look  upon  it 
as  a  thing  from  which  he  is  warned  by  the  laws  of  the  large 
proprietors,  and  becomes,  in  consequence,  spiritless,  purpose¬ 
less.  .  .  .  The  German  bauer,  on  the  contrary,  looks  on  the 
country  as  made  for  him  and  his  fellow-men.  He  feels  himself 

*  “  Rural  and  Domestic  Life  of  Germany,”  p.  27.  t  Ibid.  p.  40. 

VOL.  I. — 17 


258 


POLITICAL  ECONOMY 


a  man;  he  has  a  stake  in  the  country,  as  good  as  that  of  the 
bulk  of  his  neighbors;  no  man  can  threaten  him  with  ejection, 
or  the  workhouse,  so  long  as  he  is  active  and  economical.  He 
walks,  therefore,  with  a  bold  step ;  he  looks  you  in  the  face  with 
the  air  of  a  free  man,  but  of  a  respectful  one.” 

Of  their  industry,  the  same  writer  thus  further  speaks: 
“  There  is  not  an  hour  of  the  year  in  which  they  do  not  find 
unceasing  occupation.  In  the  depth  of  winter,  when  the  weather 
permits  them  by  any  means  to  get  out  of  doors,  they  are  always 
finding  something  to  do.  They  carry  out  their  manure  to  their 
lands  while  the  frost  is  in  them.  If  there  is  not  frost,  they  are 
busy  cleaning  ditches  and  felling  old  fruit-trees,  or  such  as  do 
not  bear  well.  Such  of  them  as  are  too  poor  to  lay  in  a  sufficient 
stock  of  wood,  find  plenty  of  work  in  ascending  into  the  moun¬ 
tainous  woods,  and  bringing  thence  fuel.  It  would  astonish 
the  English  common  people  to  see  the  intense  labor  with  which 
the  Germans  earn  their  firewood.  In  the  depth  of  frost  and 
snow,  go  into  any  of  their  hills  and  woods,  and  there  you  find 
them  hacking  up  stumps,  cutting  off  branches,  and  gathering, 
by  all  means  which  the  official  wood-police  will  allow,  boughs, 
stakes,  and  pieces  of  wood,  which  they  convey  home  with  the 
most  incredible  toil  and  patience.”  *  After  a  description  of 
their  careful  and  laborious  vineyard  culture,  he  continues :  f 
“  In  England,  with  its  great  quantity  of  grass  lands,  and  its 
large  farms,  so  soon  as  the  grain  is  in,  and  the  fields  are  shut 
up  for  hay  grass,  the  country  seems  in  a  comparative  state 
of  rest  and  quiet.  But  here  they  are  everywhere,  and  forever, 
hoeing  and  mowing,  planting  and  cutting,  weeding  and  gather¬ 
ing.  They  have  a  succession  of  crops  like  a  market-gardener. 
They  have  their  carrots,  poppies,  hemp,  flax,  saintfoin,  lucerne, 
rape,  colewort,  cabbage,  rutabaga,  black  turnips,  Swedish  and 
white  turnips,  teazles,  Jerusalem  artichokes,  mangel-wurzel, 
parsnips,  kidney  beans,  field  beans  and  peas,  vetches,  Indian 
corn,  buckwheat,  madder  for  the  manufacturer,  potatoes,  their 
great  crop  of  tobacco,  millet — all,  for  the  greater  part,  under 
the  family  management,  in  their  own  family  allotments.  They 
have  had  these  things  first  to  sow,  many  of  them  to  transplant, 
to  hoe,  to  weed,  to  clear  off  insects,  to  top ;  many  of  them  to 
mow  and  gather  in  successive  crops.  They  have  their  water- 
meadows,  of  which  kind  almost  all  their  meadows  are,  to  flood, 

*  “  Rural  and  Domestic  Life  of  Germany,”  p.  44.  f  Ibid.  p.  50. 


PEASANT  PROPRIETORS 


259 


to  mow,  and  reflood ;  watercourses  to  reopen  and  to  make  anew ; 
their  early  fruits  to  gather,  to  bring  to  market  with  their  green 
crops  of  vegetables;  their  cattle,  sheep,  calves,  foals,  most  of 
them  prisoners,  and  poultry  to  look  after;  their  vines,  as  they 
shoot  rampantly  in  the  summer  heat,  to  prune,  and  thin  out  the 
leaves  when  they  are  too  thick :  and  anyone  may  imagine  what 
a  scene  of  incessant  labor  it  is.” 

This  interesting  sketch,  to  the  general  truth  of  which  any 
observant  traveller  in  that  highly  cultivated  and  populous  re¬ 
gion  can  bear  witness,  accords  with  the  more  elaborate  delinea¬ 
tion  by  a  distinguished  inhabitant,  Professor  Rau,  in  his  little 
treatise  “  On  the  Agriculture  of  the  Palatinate.”  *  Dr.  Rau 
bears  testimony  not  only  to  the  industry,  but  to  the  skill  and 
intelligence  of  the  peasantry;  their  judicious  employment  of 
manures,  and  excellent  rotation  of  crops;  the  progressive  im¬ 
provement  of  their  agriculture  for  generations  past,  and  the 
spirit  of  further  improvement  which  is  still  active.  “  The  inde¬ 
fatigableness  of  the  country  people,  who  may  be  seen  in  activity 
all  the  day  and  all  the  year,  and  are  never  idle,  because  they  make 
a  good  distribution  of  their  labors,  and  find  for  every  interval 
of  time  a  suitable  occupation,  is  as  well  known  as  their  zeal 
is  praiseworthy  in  turning  to  use  every  circumstance  which 
presents  itself,  in  seizing  upon  every  useful  novelty  which  of¬ 
fers,  and  even  in  searching  out  new  and  advantageous  methods. 
One  easily  perceives  that  the  peasant  of  this  district  has  reflected 
much  on  his  occupation :  he  can  give  reasons  for  his  modes  of 
proceeding,  even  if  those  reasons  are  not  always  tenable ;  he 
is  as  exact  an  observer  of  proportions  as  it  is  possible  to  be  from 
memory,  without  the  aid  of  figures :  he  attends  to  such  general 
signs  of  the  times  as  appear  to  augur  him  either  benefit  or 
harm.”  \ 

The  experience  of  all  other  parts  of  Germany  is  similar.  “  In 
Saxony,”  says  Mr.  Kay,  “  it  is  a  notorious  fact,  that  during 
the  last  thirty  years,  and  since  the  peasants  became  the  proprie¬ 
tors  of  the  land,  there  has  been  a  rapid  and  continual  improve¬ 
ment  in  the  condition  of  the  houses,  in  the  manner  of  living, 
in  the  dress  of  the  peasants,  and  particularly  in  the  culture  of 
the  land.  I  have  twice  walked  through  that  part  of  Saxony 
called  Saxon  Switzerland,  in  company  with  a  German  guide, 

*  “  On  the  Agriculture  of  the  Palati-  Heidelberg.”  By  Dr.  Karl  Heinrich 
nate,  and  particularly  in  the  territory  of  Rau.  Heidelberg,  1830. 

t  Rau,  pp.  15,  16. 


260 


POLITICAL  ECONOMY 


and  on  purpose  to  see  the  state  of  the  villages  and  of  the  farm¬ 
ing,  and  I  can  safely  challenge  contradiction  when  I  affirm 
that  there  is  no  farming  in  all  Europe  superior  to  the  laboriously 
careful  cultivation  of  the  valleys  of  that  part  of  Saxony.  There, 
as  in  the  cantons  of  Berne,  Vaud,  and  Zurich,  and  in  the  Rhine 
provinces,  the  farms  are  singularly  flourishing.  They  are  kept 
in  beautiful  condition,  and  are  always  neat  and  well  managed. 
The  ground  is  cleared  as  if  it  were  a  garden.  No  hedges  or 
brushwood  encumber  it.  Scarcely  a  rush  or  thistle  or  a  bit 
of  rank  grass  is  to  be  seen.  The  meadows  are  well  watered 
every  spring  with  liquid  manure,  saved  from  the  drainings  of 
the  farmyards.  The  grass  is  so  free  from  weeds  that  the  Saxon 
meadows  reminded  me  more  of  English  lawns  than  of  anything 
else  I  had  seen.  The  peasants  endeavor  to  outstrip  one  another 
in  the  quantity  and  quality  of  the  produce,  in  the  preparation 
of  the  ground,  and  in  the  general  cultivation  of  their  respective 
portions.  All  the  little  proprietors  are  eager  to  find  out  how 
to  farm  so  as  to  produce  the  greatest  results;  they  diligently 
seek  after  improvements ;  they  send  their  children  to  the  agri¬ 
cultural  schools  in  order  to  fit  them  to  assist  their  fathers ;  and 
each  proprietor  soon  adopts  a  new  improvement  introduced  by 
any  of  his  neighbors.”  *  If  this  be  not  overstated,  it  denotes 
a  state  of  intelligence  very  different  not  only  from  that  of  Eng¬ 
lish  laborers  but  of  English  farmers. 

Mr.  Kay’s  book,  published  in  1850,  contains  a  mass  of  evi¬ 
dence  gathered  from  observation  and  inquiries  in  many  different 
parts  of  Europe,  together  with  attestations  from  many  distin¬ 
guished  writers,  to  the  beneficial  effects  of  peasant  properties. 
Among  the  testimonies  which  he  cites  respecting  their  effect  on 
agriculture,  I  select  the  following: 

“  Reichensperger,  himself  an  inhabitant  of  that  part  of  Prus¬ 
sia  where  the  land  is  the  most  subdivided,  has  published  a  long 
and  very  elaborate  work  to  show  the  admirable  consequences 
of  a  system  of  freeholds  in  land.  He  expresses  a  very  decided 
opinion  that  not  only  are  the  gross  products  of  any  given  num¬ 
ber  of  acres  held  and  cultivated  by  small  or  peasant  proprietors, 
greater  than  the  gross  products  of  an  equal  number  of  acres 
held  by  a  few  great  proprietors,  and  cultivated  by  tenant  farm- 

*  “  The  Social  Condition  and  Educa-  By  Joseph  Kay,  Esq.,  M.A..  Barrister- 
tion  of  the  People  in  England  and  Eu-  at-Law,  and  late  Travelling  Bachelor  of 
rope;  showing  the  Results  of  the  Pri-  the  University  of  Cambridge.  Vol.  i. 
mary  Schools,  and  of  the  Division  of  pp.  138 — 40. 

Landed  Property  in  Foreign  Countries.” 


PEASANT  PROPRIETORS 


261 


ers,  but  that  the  net  products  of  the  former,  after  deducting  all 
the  expenses  of  cultivation,  are  also  greater  than  the  net  prod¬ 
ucts  of  the  latter.  .  .  .  He  mentions  one  fact  which  seems 
to  prove  that  the  fertility  of  the  land  in  countries  where  the 
properties  are  small,  must  be  rapidly  increasing.  He  says  that 
the  price  of  the  land  which  is  divided  into  small  properties  in 
the  Prussian  Rhine  provinces,  is  much  higher,  and  has  been 
rising  much  more  rapidly,  than  the  price  of  land  on  the  great 
estates.  He  and  Professor  Rau  both  say  that  this  rise  in  the 
price  of  the  small  estates  would  have  ruined  the  more  recent 
purchasers,  unless  the  productiveness  of  the  small  estates  had 
increased  in  at  least  an  equal  proportion ;  and  as  the  small  pro¬ 
prietors  have  been  gradually  becoming  more  and  more  pros¬ 
perous  notwithstanding  the  increasing  prices  they  have  paid 
for  their  land,  he  argues,  with  apparent  justness,  that  this 
would  seem  to  show  that  not  only  the  gross  profits  of  the  small 
estates,  but  the  net  profits  also,  have  been  gradually  increasing, 
and  that  the  net  profits  per  acre,  of  land,  when  farmed  by  small 
proprietors,  are  greater  than  the  net  profits  per  acre  of  land 
farmed  by  a  great  proprietor.  He  says,  with  seeming  truth, 
that  the  increasing  price  of  land  in  the  small  estates  cannot  be 
the  mere  effect  of  competition,  or  it  would  have  diminished 
the  profits  and  the  prosperity  of  the  small  proprietors,  and  that 
this  result  has  not  followed  the  rise. 

“  Albrecht  Thaer,  another  celebrated  German  writer  on  the 
different  systems  of  agriculture,  in  one  of  his  later  works 
(‘Principles  of  Rational  Agriculture’)  expresses  his  decided 
conviction,  that  the  net  produce  of  land  is  greater  when  farmed 
by  small  proprietors  than  when  farmed  by  great  proprietors 
or  their  tenants.  .  .  .  This  opinion  of  Thaer  is  all  the  more 
remarkable,  as,  during  the  early  part  of  his  life,  he  was  very 
strongly  in  favor  of  the  English  system  of  great  estates  and 
great  farms.” 

Mr.  Kay  adds,  from  his  own  observation,  “  The  peasant 
farming  of  Prussia,  Saxony,  Holland,  and  Switzerland  is  the 
most  perfect  and  economical  farming  I  have  ever  witnessed  in 
any  country.”  * 

§  5.  But  the  most  decisive  example  in  opposition  to  the  Eng¬ 
lish  prejudice  against  cultivation  by  peasant  proprietors,  is  the 
case  of  Belgium.  The  soil  is  originally  one  of  the  worst  in 


*  Kay,  i.  116 — 18. 


262 


POLITICAL  ECONOMY 


Europe.  “  The  provinces,”  says  Mr.  M’Culloch,*  “  of  West 
and  East  Flanders,  and  Hainault,  form  a  far-stretching  plain, 
of  which  the  luxuriant  vegetation  indicates  the  indefatigable 
care  and  labor  bestowed  upon  its  cultivation;  for  the  natural 
soil  consists  almost  wholly  of  barren  sand,  and  its  great  fertility 
is  entirely  the  result  of  very  skilful  management  and  judicious 
application  of  various  manures.”  There  exists  a  carefully  pre¬ 
pared  and  comprehensive  treatise  on  Flemish  Husbandry,  in  the 
Farmer’s  Series  of  the  Society  for  the  Diffusion  of  Useful 
Knowledge.  The  writer  observes,!  that  the  Flemish  agricult¬ 
urists  “  seem  to  want  nothing  but  a  space  to  work  upon :  what¬ 
ever  be  the  quality  or  texture  of  the  soil,  in  time  they  will  make 
it  produce  something.  The  sand  in  the  Campine  can  be  com¬ 
pared  to  nothing  but  the  sands  on  the  seashore,  which  they 
probably  were  originally.  It  is  highly  interesting  to  follow 
step  by  step  the  progress  of  improvement.  Here  you  see  a 
cottage  and  rude  cow-shed  erected  on  a  spot  of  the  most  un¬ 
promising  aspect.  The  loose  white  sand  blown  into  irregular 
mounds  is  only  kept  together  by  the  roots  of  the  heath :  a  small 
spot  only  is  levelled  and  surrounded  by  a  ditch :  part  of  this  is 
covered  with  young  broom,  part  is  planted  with  potatoes,  and 
perhaps  a  small  patch  of  diminutive  clover  may  show  itself :  ” 
but  manures,  both  solid  and  liquid,  are  collecting,  “  and  this  is 
the  nucleus  from  which,  in  a  few  years,  a  little  farm  will  spread 
around.  ...  If  there  is  no  manure  at  hand,  the  only  thing 
that  can  be  sown,  on  pure  sand,  at  first,  is  broom :  this  grows 
in  the  most  barren  soils ;  in  three  years  it  is  fit  to  cut,  and  pro¬ 
duces  some  return  in  fagots  for  the  bakers  and  brickmakers. 
The  leaves  which  have  fallen  have  somewhat  enriched  the  soil, 
and  the  fibres  of  the  roots  have  given  a  certain  degree  of  com¬ 
pactness.  It  may  now  be  ploughed  and  sown  with  buckwheat, 
or  even  with  rye  without  manure.  By  the  time  this  is  reaped, 
some  manure  may  have  been  collected,  and  a  regular  course 
of  cropping  may  begin.  As  soon  as  clover  and  potatoes  enable 
the  farmer  to  keep  cows  and  make  manure,  the  improvement 
goes  on  rapidly;  in  a  few  years  the  soil  undergoes  a  complete 
change :  it  becomes  mellow  and  retentive  of  moisture,  and  en¬ 
riched  by  the  vegetable  matter  afforded  by  the  decomposition 
of  the  roots  of  clover  and  other  plants.  .  .  .  After  the  land 
has  been  gradually  brought  into  a  good  state,  and  is  cultivated 

*  “  Geographical  Dictionary,”  art.  “  Belgium.”  f  Pp.  11 — 14. 


PEASANT  PROPRIETORS 


263 


in  a  regular  manner,  there  appears  much  less  difference  be¬ 
tween  the  soils  which  have  been  originally  good,  and  those 
which  have  been  made  so  by  labor  and  industry.  At  least  the 
crops  in  both  appear  more  nearly  alike  at  harvest,  than  is  the 
case  in  soils  of  different  qualities  in  other  countries.  This  is 
a  great  proof  of  the  excellency  of  the  Flemish  system ;  for  it 
shows  that  the  land  is  in  a  constant  state  of  improvement,  and 
that  the  deficiency  of  the  soil  is  compensated  by  greater  atten¬ 
tion  to  tillage  and  manuring,  especially  the  latter.” 

The  people  who  labor  thus  intensely,  because  laboring  for 
themselves,  have  practised  for  centuries  those  principles  of  ro¬ 
tation  of  crops  and  economy  of  manures,  which  in  England 
are  counted  among  modern  discoveries:  and  even  now  the 
superiority  of  their  agriculture,  as  a  whole,  to  that  of  England, 
is  admitted  by  competent  judges.  “  The  cultivation  of  a  poor 
light  soil,  or  a  moderate  soil,”  says  the  writer  last  quoted,* 
“  is  generally  superior  in  Flanders  to  that  of  the  most  improved 
farms  of  the  same  kind  in  Britain.  We  surpass  the  Flemish 
farmer  greatly  in  capital,  in  varied  implements  of  tillage,  in 
the  choice  and  breeding  of  cattle  and  sheep  ”  (though,  accord¬ 
ing  to  the  same  authority, f  they  are  much  “before  us  in  the 
feeding  of  their  cows  ”),  “  and  the  British  farmer  is  in  general  a 
man  of  superior  education  to  the  Flemish  peasant.  But  in  the 
minute  attention  to  the  qualities  of  the  soil,  in  the  management 
and  application  of  manures  of  different  kinds,  in  the  judicious 
succession  of  crops,  and  especially  in  the  economy  of  land,  so 
that  every  part  of  it  shall  be  in  a  constant  state  of  production, 
we  have  still  something  to  learn  from  the  Flemings,”  and  not 
from  an  instructed  and  enterprising  Fleming  here  and  there,  but 
from  the  general  practice. 

Much  of  the  most  highly  cultivated  part  of  the  country  con¬ 
sists  of  peasant  properties,  managed  by  the  proprietors,  always 
either  wholly  or  partly  by  spade  industry.];  “  When  the  land 
is  cultivated  entirely  by  the  spade,  and  no  horses  are  kept,  a 
cow  is  kept  for  every  three  acres  of  land,  and  entirely  fed  on 
artificial  grasses  and  roots.  This  mode  of  cultivation  is  princi¬ 
pally  adopted  in  the  Waes  district,  where  properties  are  very 
small.  All  the  labor  is  done  by  the  different  members  of  the 
family ;  ”  children  soon  beginning  “  to  assist  in  various  minute 
operations,  according  to  their  age  and  strength,  such  as  weed- 

t  Ibid.,  p.  13.  t  Ibid.,  pp.  73  et  seq. 


*  “Flemish  Husbandry,"  p.  3. 


264 


POLITICAL  ECONOMY 


ing,  hoeing,  feeding  the  cows.  If  they  can  raise  rye  and  wheat 
enough  to  make  their  bread,  and  potatoes,  turnips,  carrots,  and 
clover,  for  the  cows,  they  do  well ;  and  the  produce  of  the  sale 
of  their  rape-seed,  their  flax,  their  hemp,  and  their  butter,  after 
deducting  the  expense  of  manure  purchased,  which  is  always 
considerable,  gives  them  a  very  good  profit.  Suppose  the  whole 
extent  of  the  land  to  be  six  acres,  which  is  not  an  uncommon 
occupation,  and  which  one  man  can  manage;”  then  (after 
describing  the  cultivation),  “  if  a  man  with  his  wife  and  three 
young  children  are  considered  as  equal  to  three  and  a  half 
grown-up  men,  the  family  will  require  thirty-nine  bushels  of 
grain,  forty-nine  bushels  of  potatoes,  a  fat  hog,  and  the  butter 
and  milk  of  one  cow :  an  acre  and  a  half  of  land  will  produce 
the  grain  and  potatoes,  and  allow  some  corn  to  finish  the  fatten¬ 
ing  of  the  hog,  which  has  the  extra  buttermilk :  another  acre 
in  clover,  carrots,  and  potatoes,  together  with  the  stubble  tur¬ 
nips,  will  more  than  feed  the  cow ;  consequently  two  and  a  half 
acres  of  land  is  sufficient  to  feed  this  family,  and  the  produce 
of  the  other  three  and  a  half  may  be  sold  to  pay  the  rent  or 
the  interest  of  purchase-money,  wear  and  tear  of  implements, 
extra  manure,  and  clothes  for  the  family.  But  these  acres  are 
the  most  profitable  on  the  farm,  for  the  hemp,  flax,  and  colza 
are  included;  and  by  having  another  acre  in  clover  and  roots, 
a  second  cow  can  be  kept,  and  its  produce  sold.  We  have, 
therefore,  a  solution  of  the  problem,  how  a  family  can  live  and 
thrive  on  six  acres  of  moderate  land.”  After  showing  by  calcu¬ 
lation,  that  this  extent  of  land  can  be  cultivated  in  the  most 
perfect  manner  by  the  family  without  any  aid  from  hired  labor, 
the  writer  continues :  “  In  a  farm  of  ten  acres  entirely  culti¬ 
vated  by  the  spade,  the  addition  of  a  man  and  a  woman  to  the 
members  of  the  family  will  render  all  the  operations  more  easy ; 
and  with  a  horse  and  cart  to  carry  out  the  manure,  and  bring 
home  the  produce,  and  occasionally  draw  the  harrows,  fifteen 
acres  may  be  very  well  cultivated.  .  .  .  Thus  it  will  be  seen  ” 
(this  is  the  result  of  some  pages  of  details  and  calculations  *), 
“  that  by  spade  husbandry,  an  industrious  man  with  a  small 
capital,  occupying  only  fifteen  acres  of  good  light  land,  may 
not  only  live  and  bring  up  a  family,  paying  a  good  rent,  but 
may  accumulate  a  considerable  sum  in  the  course  of  his  life.” 
But  the  indefatigable  industry  by  which  he  accomplishes  this, 

*  “  Flemish  Husbandry,”  p.  81. 


PEASANT  PROPRIETORS 


265 


and  of  which  so  large  a  portion  is  expended  not  in  the  mere 
cultivation,  but  in  the  improvement,  for  a  distant  return,  of 
the  soil  itself — has  that  industry  no  connection  with  not  paying 
rent  ?  Could  it  exist,  without  presupposing,  at  least,  a  virtually 
permanent  tenure? 

As  to  their  mode  of  living,  “  the  Flemish  farmers  and  laborers 
live  much  more  economically  than  the  same  class  in  England: 
they  seldom  eat  meat,  except  on  Sundays  and  in  harvest:  but¬ 
termilk  and  potatoes  with  brown  bread  is  their  daily  food.”  It 
is  on  this  kind  of  evidence  that  English  travellers,  as  they  hurry 
through  Europe,  pronounce  the  peasantry  of  every  Continental 
country  poor  and  miserable,  its  agricultural  and  social  system 
a  failure,  and  the  English  the  only  regime  under  which  laborers 
are  well  off.  It  is,  truly  enough,  the  only  regime  under  which 
laborers,  whether  well  off  or  not,  never  attempt  to  be  better.  So 
little  are  English  laborers  accustomed  to  consider  it  possible 
that  a  laborer  should  not  spend  all  he  earns,  that  they  habit¬ 
ually  mistake  the  signs  of  economy  for  those  of  poverty.  Ob¬ 
serve  the  true  interpretation  of  the  phenomena : 

“  Accordingly  they  are  gradually  acquiring  capital,  and  their 
great  ambition  is  to  have  land  of  their  own.  They  eagerly  seize 
every  opportunity  of  purchasing  a  small  farm,  and  the  price  is 
so  raised  by  competition,  that  land  pays  little  more  than  two 
per  cent,  interest  for  the  purchase  money.  Large  properties 
gradually  disappear,  and  are  divided  into  small  portions,  which 
sell  at  a  high  rate.  But  the  wealth  and  industry  of  the  popu¬ 
lation  are  continually  increasing,  being  rather  diffused  through 
the  masses  than  accumulated  in  individuals.” 

With  facts  like  these,  known  and  accessible,  it  is  not  a  little 
surprising  to  find  the  case  of  Flanders  referred  to  not  in  recom¬ 
mendation  of  peasant  properties,  but  as  a  warning  against  them ; 
on  no  better  ground  than  a  presumptive  excess  of  population, 
inferred  from  the  distress  which  existed  among  the  peasantry 
of  Brabant  and  East  Flanders  in  the  disastrous  year  1846-47. 
The  evidence  which  I  have  cited  from  a  writer  conversant  with 
the  subject,  and  having  no  economical  theory  to  support,  shows 
that  the  distress,  whatever  may  have  been  its  severity,  arose 
from  no  insufficiency  in  these  little  properties  to  supply  abun¬ 
dantly,  in  any  ordinary  circumstances,  the  wants  of  all  whom 
they  have  to  maintain.  It  arose  from  the  essential  condition 
to  which  those  are  subject  who  employ  land  of  their  own  in 


266 


POLITICAL  ECONOMY 


growing  their  own  food,  namely,  that  the  vicissitudes  of  the 
seasons  must  be  borne  by  themselves,  and  cannot,  as  in  the 
case  of  large  farmers,  be  shifted  from  them  to  the  consumer. 
When  we  remember  the  season  of  1846,  a  partial  failure  of  all 
kinds  of  grain,  and  an  almost  total  one  of  the  potato,  it  is  no 
wonder  that  in  so  unusual  a  calamity  the  produce  of  six  acres, 
half  of  them  sown  with  flax,  hemp,  or  oil-seeds,  should  fall 
short  of  a  year’s  provision  for  a  family.  But  we  are  not  to 
contrast  the  distressed  Flemish  peasant  with  an  English  capi¬ 
talist  who  farms  several  hundred  acres  of  land.  If  the  peasant 
were  an  Englishman,  he  would  not  be  that  capitalist,  but  a 
day  laborer  under  a  capitalist.  And  is  there  no  distress,  in  times 
of  dearth,  among  day  laborers?  Was  there  none,  that  year, 
in  countries  where  small  proprietors  and  small  farmers  are 
unknown?  I  am  aware  of  no  reason  for  believing  that  the 
distress  was  greater  in  Belgium,  than  corresponds  to  the  pro¬ 
portional  extent  of  the  failure  of  crops  compared  with  other 
countries.* 

§  6.  The  evidence  of  the  beneficial  operation  of  peasant  prop¬ 
erties  in  the  Channel  Islands  is  of  so  decisive  a  character,  that  I 
cannot  help  adding  to  the  numerous  citations  already  made, 
part  of  a  description  of  the  economical  condition  of  those  islands, 
by  a  writer  who  combines  personal  observation  with  an  attentive 
study  of  the  information  afforded  by  others.  Mr.  William 
Thornton,  in  his  “  Plea  for  Peasant  Proprietors,”  a  book  which 
by  the  excellence  both  of  its  materials  and  of  its  execution,  de¬ 
serves  to  be  regarded  as  the  standard  work  on  that  side  of  the 
question,  speaks  of  the  island  of  Guernsey  in  the  following  terms : 
“  Not  even  in  England  is  nearly  so  large  a  quantity  of  produce 
sent  to  market  from  a  tract  of  such  limited  extent.  This  of  itself 
might  prove  that  the  cultivators  must  be  far  removed  above 
poverty,  for  being  absolute  owners  of  all  the  produce  raised  by 
them,  they  of  course  sell  only  what  they  do  not  themselves  re¬ 
quire.  But  the  satisfactoriness  of  their  condition  is  apparent 


*  As  much  of  the  distress  lately  com¬ 
plained  of  in  Belgium,  as  partakes  in 
any  degree  of  a  permanent  character, 
appears  to  be  almost  confined  to  the 
portion  of  the  population  who  carry  on 
manufacturing  labor,  either  by  itself  or 
in  conjunction  with  agricultural;  and  to 
be  occasioned  by  a  diminished  demand 
for  Belgic  manufactures. 

To  the  preceding  testimonies  Respect¬ 
ing  Germany,  Switzerland,  and  Belgium, 


may  be  added  the  following  from 
Niebuhr,  respecting  the  Roman  Cam- 
pagna.  In  a  letter  from  Tivoli,  he  says: 
“  Wherever  you  find  hereditary  farmers, 
or  small  proprietors,  there  you  also  find 
industry  and  honesty.  I  believe  that  a 
man  who  would  employ  a  large  fortune 
in  establishing  small  freeholds  might 
put  an  end  to  robbery  in  the  mountain 
districts.” — “  Life  and  Letters  of  Nie¬ 
buhr,”  vol.  ii.  p.  149. 


PEASANT  PROPRIETORS 


267 


to  every  observer.  ‘  The  happiest  community/  says  Mr.  Hill, 
‘  which  it  has  ever  been  my  lot  to  fall  in  with,  is  to  be  found  in 
this  little  island  of  Guernsey/  ‘  No  matter/  says  Sir  George 
Head,  ‘  to  what  point  the  traveller  may  choose  to  bend  his  way, 
comfort  everywhere  prevails/  What  most  surprises  the  English 
visitor  in  his  first  walk  or  drive  beyond  the  bounds  of  St.  Peter’s 
Port,  is  the  appearance  of  the  habitations  with  which  the  land¬ 
scape  is  thickly  studded.  Many  of  them  are  such  as  in  his  own 
country  would  belong  to  persons  of  middle  rank;  but  he  is  puz¬ 
zled  to  guess  what  sort  of  people  live  in  the  others,  which,  though 
in  general  not  large  enough  for  farmers,  are  almost  invariably 
much  too  good  in  every  respect  for  day  laborers.  .  .  .  Lit¬ 
erally,  in  the  whole  island,  with  the  exception  of  a  few  fisher¬ 
men’s  huts,  there  is  not  one  so  mean  as  to  be  likened  to  the  ordi¬ 
nary  habitation  of  an  English  farm  laborer.  .  .  .  ‘  Look/ 

says  a  late  Bailiff  of  Guernsey,  Mr.  De  L’lsle  Brock,  ‘  at  the 
hovels  of  the  English,  and  compare  them  with  the  cottages  of  our 
peasantry/  .  .  .  Beggars  are  utterly  unknown.  .  .  .  Pau¬ 
perism,  able-bodied  pauperism  at  least,  is  nearly  as  rare  as 
mendicancy.  The  Savings  Banks  accounts  also  bear  witness  to 
the  general  abundance  enjoyed  by  the  laboring  classes  of  Guern¬ 
sey.  In  the  year  1841,  there  were  in  England,  out  of  a  popula¬ 
tion  of  nearly  fifteen  millions,  less  than  700,000  depositors,  or 
one  in  every  twenty  persons,  and  the  average  amount  of  the  de¬ 
posits  was  £30.  In  Guernsey,  in  the  same  year,  out  of  a  popula¬ 
tion  of  26,000  the  number  of  depositors  was  1920,  and  the  aver¬ 
age  amount  of  the  deposits  £40.”  *  The  evidence  as  to  Jersey 
and  Alderney  is  of  a  similar  character. 

Of  the  efficiency  and  productiveness  of  agriculture  on  the 
small  properties  of  the  Channel  Islands,  Mr.  Thornton  produces 
ample  evidence, the  result  of  which  he  sums  up  as  follows:  “  Thus 
it  appears  that  in  the  two  principal  Channel  Islands,  the  agricul¬ 
tural  population  is,  in  the  one  twice,  and  in  the  other,  three 
times,  as  dense  as  in  Britain,  there  being  in  the  latter  country 
only  one  cultivator  to  twenty-two  acres  of  cultivated  land,  while 
in  Jersey  there  is  one  to  eleven,  and  in  Guernsey  one  to  seven 
acres.  Yet  the  agriculture  of  these  islands  maintains,  besides 
cultivators,  non-agricultural  populations,  respectively  four  and 
five  times  as  dense  as  that  of  Britain.  This  difference  does  not 
arise  from  any  superiority  of  soil  or  climate  possessed  by  the 

*  “  A  Plea  for  Peasant  Proprietors.”  By  William  Thomas  Thornton,  pp.  99—104. 


268 


POLITICAL  ECONOMY 


Channel  Islands,  for  the  former  is  naturally  rather  poor,  and 
the  latter  is  not  better  than  in  the  southern  counties  of  England. 
It  is  owing  entirely  to  the  assiduous  care  of  the  farmers,  and  to 
the  abundant  use  of  manure.”  *  “  In  the  year  1837,”  he  says 
in  another  place, f  “  the  average  yield  of  wheat  in  the  large 
farms  of  England  was  only  twenty-one  bushels,  and  the  highest 
average  for  any  one  county  was  no  more  than  twenty-six 
bushels.  The  highest  average  since  claimed  for  the  whole  of 
England,  is  thirty  bushels.  In  Jersey,  where  the  average  size  of 
farms  is  only  sixteen  acres,  the  average  produce  of  wheat  per 
acre  was  stated  by  Inglis  in  1834  to  be  thirty-six  bushels;  but 
it  is  proved  by  official  tables  to  have  been  forty  bushels  in  the 
five  years  ending  with  1833.  In  Guernsey,  where  farms  are  still 
smaller,  four  quarters  per  acre,  according  to  Inglis,  is  consid¬ 
ered  a  good,  but  still  a  very  common  crop.”  “  Thirty  shillings  J 
an  acre  would  be  thought  in  England  a  very  fair  rent  for  mid¬ 
dling  land ;  but  in  the  Channel  Islands,  it  is  only  very  inferior  land 
that  would  not  let  for  at  least  £4.” 

§  7.  It  is  from  France,  that  impressions  unfavorable  to  peas¬ 
ant  properties  are  generally  drawn;  it  is  in  France  that  the  sys¬ 
tem  is  so  often  asserted  to  have  brought  forth  its  fruit  in  the 
most  wretched  possible  agriculture,  and  to  be  rapidly  reducing, 
if  not  to  have  already  reduced,  the  peasantry,  by  subdivision  of 
land,  to  the  verge  of  starvation.  It  is  difficult  to  account  for  the 
general  prevalence  of  impressions  so  much  the  reverse  of  truth. 
The  agriculture  of  France  was  wretched,  and  the  peasantry  in 
great  indigence,  before  the  Revolution.  At  that  time  they  were 
not,  so  universally  as  at  present,  landed  proprietors.  There  were, 
however,  considerable  districts  of  France  where  the  land,  even 
then,  was  to  a  great  extent  the  property  of  the  peasantry,  and 
among  these  were  many  of  the  most  conspicuous  exceptions  to 
the  general  bad  agriculture  and  to  the  general  poverty.  An  au¬ 
thority,  on  this  point,  not  to  be  disputed,  is  Arthur  Young,  the 
inveterate  enemy  of  small  farms,  the  coryphaeus  of  the  modern 
English  school  of  agriculturists;  who  yet,  travelling  over  nearly 
the  whole  of  France  in  1787,  1788,  and  1789,  when  he  finds 
remarkable  excellence  of  cultivation,  never  hesitates  to  ascribe 
it  to  peasant  property.  “  Leaving  Sauve,”  says  he,§  “  I  was  much 

*  William  Thomas  Thornton’s  “  A  Plea  $  Ibid.,  p.  32. 
for  Peasant  Proprietors,”  p.  38.  §  Arthur  Young’s  “Travels  in  France,” 

t  Ibid.,  p.  9.  vol.  i.  p.  50. 


PEASANT  PROPRIETORS 


269 


struck  with  a  large  tract  of  land,  seemingly  nothing  but  huge 
rocks;  yet  most  of  it  enclosed  and  planted  with  the  most  indus¬ 
trious  attention.  Every  man  has  an  olive,  a  mulberry,  an  al¬ 
mond,  or  a  peach  tree,  and  vines  scattered  among  them ;  so  that 
the  whole  ground  is  covered  with  the  oddest  mixture  of  these 
plants  and  bulging  rocks,  that  can  be  conceived.  The  inhabi¬ 
tants  of  this  village  deserve  encouragement  for  their  industry; 
and  if  I  were  a  Trench  minister  they  should  have  it.  They  would 
soon  turn  all  the  deserts  around  them,  into  gardens.  Such  a 
knot  of  active  husbandmen,  who  turn  their  rocks  into  scenes  of 
fertility,  because  I  suppose  their  &wyi ,  would  do  the  same  by  the 
wastes,  if  animated  by  the  same  omnipotent  principle.”  Again:* 
“  Walk  to  Rossendal,”  (near  Dunkirk)  “  where  M.  le  Brun  has 
an  improvement  on  the  Dunes,  which  he  very  obligingly  showed 
me.  Between  the  town  and  that  place  is  a  great  number  of  neat 
little  houses,  built  each  with  its  garden,  and  one  or  two  fields  en¬ 
closed,  of  most  wretched  blowing  dune  sand,  naturally  as  white 
as  snow,  but  improved  by  industry.  The  magic  of  property 
turns  sand  to  gold.”  And  again:  f  “  Going  out  of  Gange,  I  was 
surprised  to  find  by  far  the  greatest  exertion  in  irrigation  which 
I  had  yet  seen  in  France;  and  then  passed  by  some  steep  moun¬ 
tains,  highly  cultivated  in  terraces.  Much  watering  at  St.  Law¬ 
rence.  The  scenery  very  interesting  to  a  farmer.  From  Gange, 
to  the  mountain  of  rough  ground  which  I  crossed,  the  ride  has 
been  the  most  interesting  which  I  have  taken  in  France;  the 
efforts  of  industry  the  most  vigorous;  the  animation  the  most 
lively.  An  activity  has  been  here,  that  has  swept  away  all  diffi¬ 
culties  before  it,  and  has  clothed  the  very  rocks  with  verdure. 
It  would  be  a  disgrace  to  common  sense  to  ask  the  cause;  the 
enjoyment  of  property  must  have  done  it.  Give  a  man  the  se¬ 
cure  possession  of  a  bleak  rock,  and  he  will  turn  it  into  a  garden; 
give  him  a  nine  years’  lease  of  a  garden,  and  he  will  convert  it 
into  a  desert.” 

In  his  description  of  the  country  at  the  foot  of  the  Western 
Pyrenees,  he  speaks  no  longer  from  surmise,  but  from  knowl¬ 
edge.  “  Take  J  the  road  to  Moneng,  and  come  presently  to  a 
scene  which  was  so  new  to  me  in  France,  that  I  could  hardly 
believe  my  own  eyes.  A  succession  of  many  well-built,  tight, 
and  comfortable  farming  cottages  built  of  stone  and  covered 

*  Arthur  Young’s  “Travels  in  France,” 
vol.  i.  p.  88. 


t  Ibid.,  p.  51. 
t  Ibid.  vol.  i. 


270 


POLITICAL  ECONOMY 


with  tiles;  each  having  its  little  garden,  enclosed  by  dipt  thorn- 
hedges,  with  plenty  of  peach  and  other  fruit-trees,  some  fine 
oaks  scattered  in  the  hedges,  and  young  trees  nursed  up  with 
so  much  care,  that  nothing  but  the  fostering  attention  of  the 
owner  could  effect  anything  like  it.  To  every  house  belongs  a 
farm,  perfectly  well  enclosed,  with  grass  borders  mown  and 
neatly  kept  around  the  corn-fields,  with  gates  to  pass  from  one 
enclosure  to  another.  There  are  some  parts  of  England  (where 
small  yeomen  still  remain)  that  resemble  this  country  of  Bearn; 
but  we  have  very  little  that  is  equal  to  what  I  have  seen  in  this 
ride  of  twelve  miles  from  Pau  to  Moneng.  It  is  all  in  the  hands 
of  little  proprietors,  without  the  farms  being  so  small  as  to  oc¬ 
casion  a  vicious  and  miserable  population.  An  air  of  neatness, 
warmth,  and  comfort  breathes  over  the  whole.  It  is  visible  in 
their  new-built  houses  and  stables;  in  their  little  gardens;  in 
their  hedges;  in  the  courts  before  their  doors;  even  in  the  coops 
for  their  poultry,  and  the  sties  for  their  hogs.  A  peasant  does 
not  think  of  rendering  his  pig  comfortable,  if  his  own  happiness 
hang  by  the  thread  of  a  nine  years’  lease.  We  are  now  in  Bearn, 
within  a  few  miles  of  the  cradle  of  Henry  IV.  Do  they  inherit 
these  blessings  from  that  good  prince?  The  benignant  genius 
of  that  good  monarch  seems  to  reign  still  over  the  country;  each 
peasant  has  the  fowl  in  the  pot.”  He  frequently  notices  the  ex¬ 
cellence  of  the  agriculture  of  French  Flanders,  where  the  farms 
“  are  all  small,  and  much  in  the  hands  of  little  proprietors.”  * 
In  the  Pays  de  Caux,  also  a  country  of  small  properties,  the  agri¬ 
culture  was  miserable;  of  which  his  explanation  was,  that  it  “  is 
a  manufacturing  country,  and  farming  is  but  a  secondary  pur¬ 
suit  to  the  cotton  fabric,  which  spreads  over  the  whole  of  it.”  f 
The  same  district  is  still  a  seat  of  manufactures,  and  a  country  of 
small  proprietors,  and  is  now,  whether  we  judge  from  the  ap¬ 
pearance  of  the  crops  or  from  the  official  returns,  one  of  the 
best  cultivated  in  France.  In  “  Flanders,  Alsace,  and  part  of 
Artois,  as  well  as  on  the  banks  of  the  Garonne,  France  possesses 
a  husbandry  equal  to  our  own.”  J  Those  countries,  and  a  con¬ 
siderable  part  of  Ouercy,  “  are  cultivated  more  like  gardens  than 
farms.  Perhaps  they  are  too  much  like  gardens,  from  the  small¬ 
ness  of  properties.”  §  In  those  districts  the  admirable  rotation 
of  crops,  so  long  practised  in  Italy,  but  at  that  time  generally 


*  Young,  pp.  322—4. 
t  Ibid.  p.  325. 


t  Ibid.  vol.  i.  p.  357. 
§  Ibid.  p.  364. 


PEASANT  PROPRIETORS 


271 


neglected  in  France,  was  already  universal.  “  The  rapid  suc¬ 
cession  of  crops,  the  harvest  of  one  being  but  the  signal  of  sowing 
immediately  for  a  second,”  (the  same  fact  which  strikes  all  ob¬ 
servers  in  the  valley  of  the  Rhine,)  “  can  scarcely  be  carried 
to  greater  perfection:  and  this  is  a  point,  perhaps,  of  all  others 
the  most  essential  to  good  husbandry,  when  such  crops  are  so 
justly  distributed  as  we  generally  find  them  in  these  provinces; 
cleaning  and  ameliorating  ones  being  made  the  preparation  for 
such  as  foul  and  exhaust.” 

It  must  not,  however,  be  supposed  that  Arthur  Young’s  testi¬ 
mony  on  the  subject  of  peasant  properties  is  uniformly  favorable. 
In  Lorraine,  Champagne,  and  elsewhere,  he  finds  the  agriculture 
bad,  and  the  small  proprietors  very  miserable,  in  consequence, 
as  he  says,  of  the  extreme  subdivision  of  the  land.  His  opinion 
is  thus  summed  up :  * — “  Before  I  travelled,  I  conceived  that 
small  farms,  in  property,  were  very  susceptible  of  good  cultiva¬ 
tion;  and  that  the  occupier  of  such,  having  no  rent  to  pay, 
might  be  sufficiently  at  his  ease  to  work  improvements,  and 
carry  on  a  vigorous  husbandry;  but  what  I  have  seen  in  France, 
has  greatly  lessened  my  good  opinion  of  them.  In  Flanders,  I 
saw  excellent  husbandry  on  properties  of  30  to  100  acres;  but 
we  seldom  find  here  such  small  patches  of  property  as  are  com¬ 
mon  in  other  provinces.  In  Alsace,  and  on  the  Garonne,  that  is, 
on  soils  of  such  exuberant  fertility  as  to  demand  no  exertions, 
some  small  properties  also  are  well  cultivated.  In  Bearn,  I 
passed  through  a  region  of  little  farmers,  whose  appearance, 
neatness,  ease,  and  happiness  charmed  me;  it  was  what  property 
alone  could,  on  a  small  scale,  effect;  but  these  were  by  no 
means  contemptibly  small;  they  are,  as  I  judged  by  the  distance 
from  house  to  house,  from  40  to  80  acres.  Except  these,  and  a 
very  few  other  instances,  I  saw  nothing  respectable  on  small 
properties,  except  a  most  unremitting  industry.  Indeed,  it  is 
necessary  to  impress  on  the  reader’s  mind,  that  though  the 
husbandry  I  met  with,  in  a  great  variety  of  instances  on  little 
properties,  was  as  bad  as  can  be  well  conceived,  yet  the  industry 
of  the  possessors  was  so  conspicuous,  and  so  meritorious,  that 
no  commendations  would  be  too  great  for  it.  It  was  sufficient 
to  prove  that  property  in  land  is,  of  all  others,  the  most  active 
instigator  to  severe  and  incessant  labor.  And  this  truth  is  of 
such  force  and  extent,  that  I  know  no  way  so  sure  of  carrying 

*  Young,  p.  412. 


272 


POLITICAL  ECONOMY 


tillage  to  a  mountain  top,  as  by  permitting  the  adjoining  villagers 
to  acquire  it  in  property;  in  fact,  we  see  that  in  the  mountains 
of  Languedoc,  etc.,  they  have  conveyed  earth  in  baskets,  on  their 
backs,  to  form  a  soil  where  nature  had  denied  it.” 

The  experience,  therefore,  of  this  celebrated  agriculturist,  and 
apostle  of  the  grande  culture,  may  be  said  to  be  that  the  effect 
of  small  properties,  cultivated  by  peasant  proprietors,  is  admir¬ 
able  when  they  are  not  too  small :  so  small,  namely,  as  not  fully 
to  occupy  the  time  and  attention  of  the  family,  for  he  often  com¬ 
plains,  with  great  apparent  reason,  of  the  quantity  of  idle  time 
which  the  peasantry  had  on  their  hands  when  the  land  was  in 
very  small  portions,  notwithstanding  the  ardor  with  which  they 
toiled  to  improve  their  little  patrimony,  in  every  way  which  their 
knowledge  or  ingenuity  could  suggest.  He  recommends,  ac¬ 
cordingly,  that  a  limit  of  subdivision  should  be  fixed  by  law;  and 
this  is  by  no  means  an  indefensible  proposition  in  countries,  if 
such  there  are,  where  division,  having  already  gone  further  than 
the  state  of  capital  and  the  nature  of  the  staple  articles  of  cul¬ 
tivation  render  advisable,  still  continues  progressive.  That  each 
peasant  should  have  a  patch  of  land,  even  in  full  property,  if  it 
is  not  sufficient  to  support  him  in  comfort,  is  a  system  with  all 
the  disadvantages,  and  scarcely  any  of  the  benefits,  of  small 
properties;  since  he  must  either  live  in  indigence  on  the  produce 
of  his  land,  or  depend  as  habitually  as  if  he  had  no  landed  pos¬ 
sessions,  on  the  wages  of  hired  labor:  which,  besides,  if  all  the 
holdings  surrounding  him  are  of  similar  dimensions,  he  has  little 
prospect  of  finding.  The  benefits  of  peasant  properties  are  con¬ 
ditional  on  their  not  being  too  much  subdivided;  that  is,  on 
their  not  being  required  to  maintain  too  many  persons,  in  pro¬ 
portion  to  the  produce  that  can  be  raised  from  them  by  those  per¬ 
sons.  The  question  resolves  itself,  like  most  questions  respect¬ 
ing  the  condition  of  the  laboring  classes,  into  one  of  population. 
Are  small  properties  a  stimulus  to  undue  multiplication,  or  a 
check  to  it? 

Chapter  VII. — Continuation  of  the  Same  Subject 

§1.  Before  examining  the  influence  of  peasant  properties  on 
the  ultimate  economical  interests  of  the  laboring  class,  as  de¬ 
termined  by  the  increase  of  population,  let  us  note  the  points  re¬ 
specting  the  moral  and  social  influence  of  that  territorial  arrange¬ 
ment,  which  may  be  looked  upon  as  established,  either  by  the 


PEASANT  PROPRIETORS 


273 


reason  of  the  case,  or  by  the  facts  and  authorities  cited  in  the 
preceding  chapter. 

The  reader  new  to  the  subject  must  have  been  struck  with  the 
powerful  impression  made  upon  all  the  witnesses  to  whom  I 
have  referred,  by  what  a  Swiss  statistical  writer  calls  the  “  al¬ 
most  superhuman  industry  ”  of  peasant  proprietors.*  On  this 
point,  at  least,  authorities  are  unanimous.  Those  who  have  seen 
only  one  country  of  peasant  properties,  always  think  the  inhabi¬ 
tants  of  that  country  the  most  industrious  in  the  world.  There 
is  as  little  doubt  among  observers,  with  what  feature  in  the  con¬ 
dition  of  the  peasantry  this  pre-eminent  industry  is  connected. 
It  is  “  the  magic  of  property/’  which,  in  the  words  of  Arthur 
Young,  “  turns  sand  into  gold.”  The  idea  of  property  does  not, 
however,  necessarily  imply  that  there  should  be  no  rent,  and 
more  than  that  there  should  be  no  taxes.  It  merely  implies 
that  the  rent  should  be  a  fixed  charge,  not  liable  to  be  raised 
against  the  possessor  by  his  own  improvements,  or  by  the  will 
of  a  landlord.  A  tenant  at  a  quit-rent  is,  to  all  intents  and  pur¬ 
poses,  a  proprietor;  a  copyholder  is  not  less  so  than  a  freeholder. 
What  is  wanted  is  permanent  possession  on  fixed  terms.  “  Give 
a  man  the  secure  possession  of  a  bleak  rock,  and  he  will  turn  it 
into  a  garden;  give  him  a  nine  years’  lease  of  a  garden,  and  he 
will  convert  it  into  a  desert.” 

The  details  which  have  been  cited,  and  those,  still  more  min¬ 
ute,  to  be  found  in  the  same  authorities,  concerning  the  habitu¬ 
ally  elaborate  system  of  cultivation,  and  the  thousand  devices  of 
the  peasant  proprietor  for  making  every  superfluous  hour  and 
odd  moment  instrumental  to  some  increase  in  the  future  produce 
and  value  of  the  land,  will  explain  what  has  been  said  in  a  previ¬ 
ous  chapter  f  respecting  the  far  larger  gross  produce  which, 
with  anything  like  parity  of  agricultural  knowledge,  is  obtained, 
from  the  same  quality  of  soil,  on  small  farms,  at  least  when  they 
are  the  property  of  the  cultivator.  The  treatise  on  “  Flemish 
Husbandry  ”  is  especially  instructive  respecting  the  means  by 
which  untiring  industry  does  more  than  outweigh  inferiority  of 
resources,  imperfection  of  implements,  and  ignorance  of  scien¬ 
tific  theories.  The  peasant  cultivation  of  Flanders  and  Italy  is 
affirmed  to  produce  heavier  crops,  in  equal  circumstances  of  soil, 
than  the  best  cultivated  districts  of  Scotland  and  England.  It 

*  The  Canton  Schaffhausen  ”  (be-  t  Supra,  Book  i.  chap.  ix.  §  4. 
fore  quoted),  p.  53. 

VOL.  I.— 18 


274 


POLITICAL  ECONOMY 


produces  them,  no  doubt,  with  an  amount  of  labor  which,  if  paid 
for  by  the  employer,  would  make  the  cost  to  him  more  than 
equivalent  to  the  benefit;  but  to  the  peasant  it  is  not  cost,  it  is 
the  devotion  of  time  which  he  can  spare,  to  a  favorite  pursuit, 
if  we  should  not  rather  say  a  ruling  passion.* 

We  have  seen,  too,  that  it  is  not  solely  by  superior  exertion 
that  the  Flemish  cultivators  succeed  in  obtaining  these  brilliant 
results.  The  same  motive  which  gives  such  intensity  to  their  in¬ 
dustry,  placed  them  earlier  in  possession  of  an  amount  of  agri¬ 
cultural  knowledge  not  attained  until  much  later  in  countries 
where  agriculture  was  carried  on  solely  by  hired  labor.  An 
equally  high  testimony  is  borne  by  M.  de  Lavergne  f  to  the  agri¬ 
cultural  skill  of  the  small  proprietors,  in  those  parts  of  France  to 
which  the  petite  culture  is  really  suitable.  “  In  the  rich  plains  of 
Flanders,  on  the  banks  of  the  Rhine,  the  Garonne,  the  Charente, 
the  Rhone,  all  the  practices  which  fertilize  the  land  and  increase 
the  productiveness  of  labor  are  known  to  the  very  smallest  cul¬ 
tivators,  and  practised  by  them,  however  considerable  may  be 
the  advances  which  they  require.  In  their  hands,  abundant  man¬ 
ures;  collected  at  great  cost,  repair  and  incessantly  increase  the 
fertility  of  the  soil,  in  spite  of  the  activity  of  cultivation.  The 
races  of  cattle  are  superior,  the  crops  magnificent.  Tobacco, 
flax,  colza,  madder,  beetroot,  in  some  places;  in  others,  the  vine, 
the  olive,  the  plum,  the  mulberry,  only  yield  their  abundant 
treasures  to  a  population  of  industrious  laborers.  Is  it  not  also 
to  the  petite  culture  that  we  are  indebted  for  most  of  the  garden 
produce  obtained  by  dint  of  great  outlay  in  the  neighboorhood 
of  Paris?  ” 


*  Read  the  graphic  description  by  the 
historian  Michelet,  of  the  feelings  of  a 
peasant  proprietor  towards  his  land. 

“  If  we  would  know  the  inmost 
thought,  the  passion,  of  the  French 
peasant,  it  is  very  easy.  Let  us  walk 
out  on  Sunday  into  the  country  and  fol¬ 
low  him.  Behold  him  yonder,  walking 
in  front  of  us.  It  is  two  o’clock;  his 
wife  is  at  vespers:  he  has  on  his  Sunday 
clothes;  I  perceive  that  he  is  going  to 
visit  his  mistress. 

“  What  mistress?  His  land. 

“  I  do  not  say  he  goes  straight  to  it. 
No,  he  is  free  to-day,  and  may  either 
go  or  not.  Does  he  not  go  every  day  in 
the  week?  Accordingly,  he  turns  aside, 
he  goes  another  way,  he  has  business 
elsewhere.  And  yet — he  goes. 

“  It  is  true,  he  was  passing  close  by; 
it  was  an  opportunity.  He  looks,  but 
apparently  he  will  not  go  in;  what  for? 
And  yet — he  enters. 


“  At  least  it  is  probable  that  he  will 
not  work;  he  is  in  his  Sunday  dress:  he 
has  a  clean  shirt  and  blouse.  Still,  there 
is  no  harm  in  plucking  up  this  weed 
and  throwing  out  that  stone.  There  is 
a  stump,  too,  which  is  in  the  way;  but 
he  has  not  his  tools  with  him,  he  will 
do  it  to-r/iorrow. 

“  Then  he  folds  his  arms  and  gazes, 
serious  and  careful.  He  gives  a  long,  a 
very  long  look,  and  seems  lost  in 
thought.  At  last,  if  he  thinks  himself 
observed,  if  he  sees  a  passerby,  he 
moves  slowly  away.  Thirty  paces  off 
he  stops,  turns  round,  and  casts  on  his 
land  a  last  look,  sombre  and  profound, 
but  to  those  who  can  see  it,  the  look  is 
full  of  passion,  of  heart,  of  devotion.” — 
“  The  People,”  by  J.  Michelet,  Part  i. 
chap.  i. 

t  s‘  Essay  on  the  Rural  Economy  of 
England,  Scotland,  and  Ireland,”  3d  ed. 
p.  1 27. 


PEASANT  PROPRIETORS 


275 


§  2.  Another  aspect  of  peasant  properties,  in  which  it  is  es¬ 
sential  that  they  should  be  considered,  is  that  of  an  instrument  of 
popular  education.  Books  and  schooling  are  absolutely  neces¬ 
sary  to  education;  but  not  all-sufficient.  The  mental  faculties 
will  be  most  developed  where  they  are  most  exercised;  and  what 
gives  more  exercise  to  them  than  the  having  a  multitude  of  in¬ 
terests,  none  of  which  can  be  neglected,  and  which  can  be  pro¬ 
vided  for  only  by  varied  efforts  of  will  and  intelligence?  Some 
of  the  disparagers  of  small  properties  lay  great  stress  on  the 
cares  and  anxieties  which  beset  the  peasant  proprietor  of  the 
Rhineland  or  Flanders.  It  is  precisely  those  cares  and  anxieties 
which  tend  to  make  him  a  superior  being  to  an  English  day- 
laborer.  It  is,  to  be  sure,  rather  abusing  the  privileges  of  fair 
argument  to  represent  the  condition  of  a  day-laborer  as  not  an 
anxious  one.  I  can  conceive  no  circumstances  in  which  he  is 
free  from  anxiety,  where  there  is  a  possibility  of  being  out  of 
employment;  unless  he  has  access  to  a  profuse  dispensation  of 
parish  pay,  and  no  shame  or  reluctance  in  demanding  it.  The 
day-laborer  has,  in  the  existing  state  of  society  and  population, 
many  of  the  anxieties  which  have  not  an  invigorating  effect  on 
the  mind,  and  none  of  those  which  have.  The  position  of  the 
peasant  proprietor  of  Flanders  is  the  reverse.  From  the  anxiety 
which  chills  and  paralyses — the  uncertainty  of  having  food  to 
eat — few  persons  are  more  exempt :  it  requires  as  rare  a  concur¬ 
rence  of  circumstances  as  the  potato  failure  combined  with  an 
universal  bad  harvest,  to  bring  him  within  reach  of  that  danger. 
His  anxieties  are  the  ordinary  vicissitudes  of  more  and  less;  his 
cares  are  that  he  takes  his  fair  share  of  the  business  of  life;  that 
he  is  a  free  human  being,  and  not  perpetually  a  child,  which 
seems  to  be  the  approved  condition  of  the  laboring  classes 
according  to  the  prevailing  philanthropy.  He  is  no  longer 
a  being  of  a  different  order  from  the  middle  classes;  he 
has  pursuits  and  objects  like  those  which  occupy  them, 
and  give  to  their  intellects  the  greater  part  of  such  culti¬ 
vation  as  they  receive.  If  there  is  a  first  principle  in  in¬ 
tellectual  education,  it  is  this — that  the  discipline  which  does 
good  to  the  mind  is  that  in  which  the  mind  is  active,  not  that  in 
which  it  is  passive.  The  secret  for  developing  the  faculties  is  to 
give  them  much  to  do,  and  much  inducement  to  do  it.  This 
detracts  nothing  from  the  importance,  and  even  necessity,  of 
other  kinds  of  mental  cultivation.  The  possession  of  property 


276 


POLITICAL  ECONOMY 


will  not  prevent  the  peasant  from  being  coarse,  selfish,  and  nar¬ 
row-minded.  These  things  depend  on  other  influences,  and  other 
kinds  of  instruction.  But  this  great  stimulus  to  one  kind  of 
mental  activity,  in  no  way  impedes  any  other  means  of  intellect¬ 
ual  development.  On  the  contrary,  by  cultivating  the  habit  of 
turning  to  practical  use  every  fragment  of  knowledge  acquired, 
it  helps  to  render  that  schooling  and  reading  fruitful,  which 
without  some  such  auxiliary  influence  are  in  too  many  cases  like 
seed  thrown  on  a  rock. 

§  3.  It  is  not  on  the  intelligence  alone  that  the  situation  of  a 
peasant  proprietor  exercises  an  improving  influence.  It  is  no 
less  propitious  to  the  moral  virtues  of  prudence,  temperance, 
and  self-control.  Day-laborers,  where  the  laboring  class  mainly 
consists  of  them,  are  usually  improvident;  they  spend  carelessly 
to  the  full  extent  of  their  means  and  let  the  future  shift  for  itself. 
This  is  so  notorious,  that  many  persons  strongly  interested  in 
the  welfare  of  the  laboring  classes,  hold  it  as  a  fixed  opinion  that 
an  increase  of  wages  would  do  them  little  good,  unless  accom¬ 
panied  by  at  least  a  corresponding  improvement  in  their  tastes 
and  habits.  The  tendency  of  peasant  proprietors,  and  of  those 
who  hope  to  become  proprietors,  is  to  the  contrary  extreme;  to 
take  even  too  much  thought  for  the  morrow.  They  are  oftener 
accused  of  penuriousness  than  of  prodigality.  They  deny  them¬ 
selves  reasonable  indulgences,  and  live  wretchedly  in  order  to 
economize.  In  Switzerland  almost  everybody  saves,  who  has 
any  means  of  saving;  the  case  of  the  Flemish  farmers  has  been 
already  noticed:  among  the  French,  though  a  pleasure-loving 
and  reputed  to  be  a  self-indulgent  people,  the  spirit  of  thrift  is 
diffused  through  the  rural  population  in  a  manner  most  grati¬ 
fying  as  a  whole,  and  which  in  individual  instances  errs  rather 
on  the  side  of  excess  than  defect.  Among  those  who,  from  the 
hovels  in  which  thev  live,  and  the  herbs  and  roots  which  con- 
stitute  their  diet,  are  mistaken  by  travellers  for  proofs  and  speci¬ 
mens  of  general  indigence,  there  are  numbers  who  have  hoards 
in  leathern  bags,  consisting  of  sums  in  five-franc  pieces,  which 
they  keep  by  them  perhaps  for  a  whole  generation,  unless 
brought  out  to  be  expended  in  their  most  cherished  gratification 
— the  purchase  of  land.  If  there  is  a  moral  inconvenience  attached 
to  a  state  of  society  in  which  the  peasantry  have  land,  it  is  the 
danger  of  their  being  too  careful  of  their  pecuniary  concerns; 
of  its  making  them  crafty,  and  “  calculating  ”  in  the  objection- 


PEASANT  PROPRIETORS 


277 


able  sense.  The  French  peasant  is  no  simple  countryman,  no 
downright  “  peasant  of  the  Danube:  ”  *  both  in  fact  and  in  fic¬ 
tion  he  is  now  “  the  crafty  peasant.”  That  is  the  stage  which 
he  has  reached  in  the  progressive  development  which  the  consti¬ 
tution  of  things  has  imposed  on  human  intelligence  and  human 
emancipation.  But  some  excess  in  this  direction  is  a  small  and 
a  passing  evil  compared  with  recklessness  and  improvidence  in 
the  laboring  classes,  and  a  cheap  price  to  pay  for  the  inestimable 
worth  of  the  virtue  of  self-dependence,  as  the  general  character¬ 
istic  of  a  people:  a  virtue  which  is  one  of  the  first  conditions  of 
excellence  in  a  human  character — the  stock  on  which  if  the  other 
virtues  are  not  grafted,  they  have  seldom  any  firm  root;  a  quality 
indispensable  in  the  case  of  a  laboring  class,  even  to  any  tolerable 
degree  of  physical  comfort;  and  by  which  the  peasantry  of 
France,  and  of  most  European  countries  of  peasant  proprietors, 
are  distinguished  beyond  any  other  laboring  population. 

§  4.  Is  it  likely,  that  a  state  of  economical  relations  so  condu¬ 
cive  to  frugality  and  prudence  in  every  other  respect,  should  be 
prejudicial  to  it  in  the  cardinal  point  of  increase  of  population? 
That  it  is  so  is  the  opinion  expressed  by  most  of  those  English 
political  economists  who  have  written  anything  about  the  mat¬ 
ter.  Mr.  M’Culloch’s  opinion  is  well  known.  Mr.  Jones  af¬ 
firms,!  that  a  “  peasant  population,  raising  their  own  wages 
from  the  soil,  and  consuming  them  in  kind,  are  universally  acted 
upon  very  feebly  by  internal  checks,  or  by  motives  disposing 
them  to  restraint.  The  consequence  is,  that  unless  some  external 
cause,  quite  independent  of  their  will,  forces  such  peasant  culti¬ 
vators  to  slacken  their  rate  of  increase,  they  will,  in  a  limited 
territory,  very  rapidly  approach  a  state  of  want  and  penury,  and 
will  be  stopped  at  last  only  by  the  physical  impossibility  of  pro¬ 
curing  subsistence.”  He  elsewhere  J  speaks  of  such  a  peasantry 
as  “  exactly  in  the  condition  in  which  the  animal  disposition  to 
increase  their  numbers  is  checked  by  the  fewest  of  those  balanc¬ 
ing  motives  and  desires  which  regulate  the  increase  of  superior 
ranks  or  more  civilized  people.”  The  “  causes  of  this  pecu¬ 
liarity  ”  Mr.  Jones  promised  to  point  out  in  a  subsequent  work, 
which  never  made  its  appearance.  I  am  totally  unable  to  con¬ 
jecture  from  what  theory  of  human  nature,  and  of  the  motives 
which  influence  human  conduct,  he  would  have  derived  them. 

*  See  the  celebrated  fable  of  La  Fon-  f  “  Essay  on  the  Distribution  of 
taine.  Wealth,”  p.  146.  $  Ibid.  p.  68. 


278 


POLITICAL  ECONOMY 


Arthur  Young  assumes  the  same  “peculiarity  ”  as  a  fact;  but, 
though  not  much  in  the  habit  of  qualifying  his  opinions,  he 
does  not  push  his  doctrine  to  so  violent  an  extreme  as  Mr.  Jones; 
having,  as  we  have  seen,  himself  testified  to  various  instances  in 
which  peasant  populations,  such  as  Mr.  Jones  speaks  of,  were 
not  tending  to  “  a  state  of  want  and  penury/’  and  were  in  no 
danger  whatever  of  coming  in  contact  with  “  physical  impossi¬ 
bility  of  procuring  subsistence.” 

That  there  should  be  discrepancy  of  experience  on  this  matter, 
is  easily  to  be  accounted  for.  Whether  the  laboring  people  live 
by  land  or  by  wages,  they  have  always  hitherto  multiplied 
up  to  the  limit  set  by  their  habitual  standard  of  com¬ 
fort.  When  that  standard  was  low,  not  exceeding  a  scanty 
subsistence,  the  size  of  properties,  as  well  as  the  rate  of 
wages,  has  been  kept  down  to  what  would  barely  support  life. 
Extremely  low  ideas  of  what  is  necessary  for  subsistence,  are 
perfectly  compatible  with  peasant  properties;  and  if  a  people 
have  always  been  used  to  poverty,  and  habit  has  reconciled  them 
to  it,  there  will  be  over-population,  and  excessive  subdivision  of 
land.  But  this  is  not  to  the  purpose.  The  true  question  is,  sup¬ 
posing  a  peasantry  to  possess  land  not  insufficient  but  sufficient 
for  their  comfortable  support,  are  they  more,  or  less,  likely  to 
fall  from  this  state  of  comfort  through  improvident  multiplica¬ 
tion,  than  if  they  were  living  in  an  equally  comfortable  manner 
as  hired  laborers?  All  a  priori  considerations  are  in  favor  of 
their  being  less  likely.  The  dependence  of  wages  on  population 
is  a  matter  of  speculation  and  discussion.  That  wages  would 
fall  if  population  were  much  increased  is  often  a  matter  of  real 
doubt,  and  always  a  thing  which  requires  some  exercise  of  the 
thinking  faculty  for  its  intelligent  recognition.  But  every  peas¬ 
ant  can  satisfy  himself  from  evidence  which  he  can  fully  appre¬ 
ciate,  whether  his  piece  of  land  can  be  made  to  support  several 
families  in  the  same  comfort  in  which  it  supports  one.  Few 
people  like  to  leave  to  their  children  a  worse  lot  in  life  than  their 
own.  The  parent  who  has  land  to  leave,  is  perfectly  able  to 
judge  whether  the  children  can  live  upon  it  or  not:  but  people 
who  are  supported  by  wages,  see  no  reason  why  their  sons 
should  be  unable  to  support  themselves  in  the  same  way,  and 
trust  accordingly  to  chance.  “  In  even  the  most  useful  and 
necessary  arts  and  manufactures,”  says  Mr.  Laing,*  “the  de- 

*  “  Notes  of  a  Traveller, ”  p.  46. 


PEASANT  PROPRIETORS 


279 

mand  for  laborers  is  not  a  seen,  known,  steady,  and  appreciable 
demand:  but  it  is  so  in  husbandry/’  under  small  properties. 
“  The  labor  to  be  done,  the  subsistence  that  labor  will  produce 
out  of  his  portion  of  land,  are  seen  and  known  elements  in  a 
man’s  calculation  upon  his  means  of  subsistence.  Can  his  square 
of  land,  or  can  it  not,  subsist  a  family?  Can  he  marry  or  not? 
are  questions  which  every  man  can  answer  without  delay,  doubt, 
or  speculation.  It  is  the  depending  on  chance,  where  judgment 
has  nothing  clearly  set  before  it,  that  causes  reckless,  improvi¬ 
dent  marriages  in  the  lower,  as  in  the  higher  classes,  and  pro¬ 
duces  among  us  the  evils  of  over-population;  and  chance  neces¬ 
sarily  enters  into  every  man’s  calculations,  when  certainty  is 
removed  altogether;  as  it  is,  where  certain  subsistence  is,  by 
our  distribution  of  property,  the  lot  of  but  a  small  portion  in¬ 
stead  of  about  two-thirds  of  the  people.” 

There  never  has  been  a  writer  more  keenly  sensible  of  the  evils 
brought  upon  the  laboring  classes  by  excess  of  population,  than 
Sismondi,  and  this  is  one  of  the  grounds  of  his  earnest  advocacy 
of  peasant  properties.  He  had  ample  opportunity,  in  more  coun¬ 
tries  than  one,  for  judging  of  their  effect  on  population.  Let  us 
see  his  testimony.  “  In  the  countries  in  which  cultivation  by 
small  proprietors  still  continues,  population  increases  regularly 
and  rapidly  until  it  has  attained  its  natural  limits ;  that  is  to  say, 
inheritances  continue  to  be  divided  and  subdivided  among  sev¬ 
eral  sons,  as  long  as,  by  an  increase  of  labor,  each  family  can 
extract  an  equal  income  from  a  smaller  portion  of  land.  A 
father  who  possessed  a  vast  extent  of  natural  pasture,  divides 
it  among  his  sons,  and  they  turn  it  into  fields  and  meadows;  his 
sons  divide  it  among  their  sons,  who  abolish  fallows:  each  im¬ 
provement  in  agricultural  knowledge  admits  of  another  step  in 
the  subdivision  of  property.  But  there  is  no  danger  lest  the 
proprietor  should  bring  up  his  children  to  make  beggars  of  them. 
He  knows  exactly  what  inheritance  he  has  to  leave  them;  he 
knows  that  the  law  will  divide  it  equally  among  them;  he  sees 
the  limit  beyond  which  this  division  would  make  them  descend 
from  the  rank  which  he  has  himself  filled,  and  a  just  family 
pride,  common  to  the  peasant  and  to  the  nobleman,  makes  him 
abstain  from  summoning  into  life,  children  for  whom  he  cannot 
properly  provide.  If  more  are  born,  at  least  they  do  not  marry, 
or  they  agree  among  themselves,  which  of  several  brothers  shall 
perpetuate  the  family.  It  is  not  found  that  in  the  Swiss  Cantons, 


28o 


POLITICAL  ECONOMY 


the  patrimonies  of  the  peasants  are  ever  so  divided  as  to  reduce 
chem  below  an  honorable  competence;  though  the  habit  of  for¬ 
eign  service,  by  opening  to  the  children  a  career  indefinite  and 
uncalculable,  sometimes  calls  forth  a  superabundant  popula¬ 
tion.”  * 

There  is  similar  testimony  respecting  Norway.  Though  there 
is  no  law  or  custom  of  primogeniture,  and  no  manufactures  to 
take  off  a  surplus  population,  the  subdivision  of  property  is  not 
carried  to  an  injurious  extent.  “  The  division  of  the  land  among 
children,”  says  Mr.  Laing,f  “  appears  not,  during  the  thousand 
years  it  has  been  in  operation,  to  have  had  the  effect  of  reducing 
the  landed  properties  to  the  minimum  size  that  will  barely  sup¬ 
port  human  existence.  I  have  counted  from  five-and-twenty  to 
forty  cows  upon  farms,  and  that  in  a  country  in  which  the  far¬ 
mer  must,  for  at  least  seven  months  in  the  year,  have  winter 
provender  and  houses  provided  for  all  the  cattle.  It  is  evident 
that  some  cause  or  other,  operating  on  aggregation  of  landed 
property,  counteracts  the  dividing  effects  of  partition  among  chil¬ 
dren.  That  cause  can  be  no  other  than  what  I  have  long  con¬ 
jectured  would  be  effective  in  such  a  social  arrangement;  viz. 
that  in  a  country  where  land  is  held,  not  in  tenancy  merely,  as 
in  Ireland,  but  in  full  ownership,  its  aggregation  by  the  deaths 
of  co-heirs,  and  by  the  marriages  of  the  female  heirs  among  the 
body  of  landholders,  will  balance  its  subdivision  by  the  equal 
succession  of  children.  The  whole  mass  of  property  will,  I  con¬ 
ceive,  be  found  in  such  a  state  of  society  to  consist  of  as  many 
estates  of  the  class  of  £1,000,  as  many  of  £100,  as  many  of 
fio,  a  year,  at  one  period  as  at  another.”  That  this  should  hap¬ 
pen,  supposes  diffused  through  society  a  very  efficacious  pru¬ 
dential  check  to  population :  and  it  is  reasonable  to  give  part  of 
the  credit  of  this  prudential  restraint  to  the  peculiar  adaptation  of 
the  peasant-proprietary  system  for  fostering  it. 

“  In  some  parts  of  Switzerland,”  says  Mr.  Kay,t  “  as  in  the 
canton  of  Argovie  for  istance,  a  peasant  never  marries  before  he 
attains  the  age  of  twenty-five  years,  and  generally  much  later  in 
life;  and  in  that  canton  the  women  very  seldom  marry  before 
they  have  attained  the  age  of  thirty.  .  .  .  Nor  do  the  divi¬ 
sion  of  land  and  the  cheapness  of  the  mode  of  conveying  it  from 
one  man  to  another,  encourage  the  providence  of  the  laborers 

*  “  Nouvcaux  Principes,”  book  iii. 
chap.  3. 


t  “  Residence  in  Norway,”  p.  18. 
t  Kay,  vol.  i.,  pp.  67—9. 


PEASANT  PROPRIETORS 


281 


of  the  rural  districts  only.  They  act  in  the  same  manner,  though 
perhaps  in  a  less  degree,  upon  the  laborers  of  the  smaller  towns. 
In  the  smaller  provincial  towns  it  is  customary  for  a  laborer  to 
own  a  small  plot  of  ground  outside  the  town.  This  plot  he  cul¬ 
tivates  in  the  evening  as  his  kitchen  garden.  He  raises  in  it 
vegetables  and  fruits  for  the  use  of  his  family  during  the  winter. 
After  his  day’s  work  is  over,  he  and  his  family  repair  to  the  gar¬ 
den  for  a  short  time,  which  they  spend  in  planting,  sowing,  weed¬ 
ing,  or  preparing  for  sowing,  a  harvest,  according  to  the  season. 
The  desire  to  become  possessed  of  one  of  these  gardens  operates 
very  strongly  in  strengthening  prudential  habits  and  in  restrain¬ 
ing  improvident  marriages.  Some  of  the  manufacturers  in  the 
canton  of  Argovie  told  me  that  a  townsman  was  seldom  con¬ 
tented  until  he  had  bought  a  garden,  or  a  garden  and  house,  and 
that  the  town  laborers  generally  deferred  their  marriages  for 
some  years,  in  order  to  save  enough  to  purchase  either  one  or 
both  of  these  luxuries.” 

The  same  writer  shows  by  statistical  evidence  *  that  in  Prussia 
the  average  age  of  marriage  is  not  only  much  later  than  in  Eng¬ 
land,  but  “is  gradually  becoming  later  than  it  was  formerly,”  while 
at  the  same  time  “  fewer  illegitimate  children  are  born  in  Prussia 
than  in  any  other  of  the  European  countries.”  “  Wherever  I 
travelled,”  says  Mr.  Kay,f  “  in  North  Germany  and  Switzer¬ 
land,  I  was  assured  by  all  that  the  desire  to  obtain  land,  which 
was  felt  by  all  the  peasants,  was  acting  as  the  strongest  possible 
check  upon  undue  increase  of  population.”  % 

In  Flanders,  according  to  Mr.  Fauche,  the  British  Consul  at 
Ostend,§  “  farmer’s  sons  and  those  who  have  the  means  to  be¬ 
come  farmers  will  delay  their  marriage  until  they  get  possession 
of  a  farm.”  Once  a  farmer,  the  next  object  is  to  become  a  pro¬ 
prietor.  “  The  first  thing  a  Dane  does  with  his  savings,”  says 
Mr.  Browne,  the  Consul  at  Copenhagen,! |  “is  to  purchase  a 


*  Kay,  vol.  i.,  pp.  75-7-9.  t  Ibid.  p.  90. 

$  The  Prussian  minister  of  statistics, 
in  a  work  (“  Condition  of  the  People  in 
Prussia  ”)  which  I  am  obliged  to  quote 
at  second-hand  from  Mr.  Kay,  after 
proving  by  figures  the  great  and  pro¬ 
gressive  increase  of  the  consumption  of 
food  and  clothing  per  head  of  the  popu¬ 
lation,  from  which  he  justly  infers  a 
corresponding  increase  of  the  produc¬ 
tiveness  of  agriculture,  continues:  “  The 
division  of  estates  has,  since  1831,  pro¬ 
ceeded  more  and  more  throughout  the 


country.  There  are  now  many  more 
small  independent  proprietors  than  for¬ 
merly.  Yet,  however  many  complaints 
of  pauperism  are  heard  among  the  de¬ 
pendent  laborers,  we  never  hear  it  com¬ 
plained  that  pauperism  is  increasing 
among  the  peasant  proprietors.” — Kay, 
i.  262 — 6. 

§  In  a  communication  to  the  Commis¬ 
sioners  of  Poor  Law  Enquiry,  p.  640  of 
their  Foreign  Communications,  Appen¬ 
dix  F  to  their  First  Report. 

||  Ibid.  p.  268. 


282 


POLITICAL  ECONOMY 


clock,  then  a  horse  and  cow,  which  he  hires  out,  and  which  pays 
a  good  interest.  Then  his  ambition  is  to  become  a  petty  proprie¬ 
tor,  and  this  class  of  persons  is  better  off  than  any  in  Denmark. 
Indeed,  I  know  of  no  people  in  any  country  who  have  more 
easily  within  their  reach  all  that  is  really  necessary  for  life  than 
this  class,  which  is  very  large  in  comparison  with  that  of  la¬ 
borers.” 

But  the  experience  which  most  decidedly  contradicts  the  assert¬ 
ed  tendency  of  peasant  proprietorship  to  produce  excess  of  popu¬ 
lation,  is  the  case  of  France.  In  that  country  the  experiment  is 
not  tried  in  the  most  favorable  circumstances,  a  large  proportion 
of  the  properties  being  too  small.  The  number  of  landed  pro¬ 
prietors  in  France  is  not  exactly  ascertained,  but  on  no  estimate 
does  it  fall  much  short  of  five  millions;  which,  on  the  lowest 
calculation  of  the  number  of  persons  of  a  family  (and  for  France 
it  ought  to  be  a  low  calculation),  shows  much  more  than  half  the 
population  as  either  possessing,  or  entitled  to  inherit,  landed 
property.  A  majority  of  the  properties  are  so  small  as  not  to 
afford  a  subsistence  to  the  proprietors,  of  whom,  according  to 
some  computations,  as  many  as  three  millions  are  obliged  to  eke 
out  their  means  of  support  either  by  working  for  hire,  or  by 
taking  additional  land,  generally  on  metayer  tenure.  When  the 
property  possessed  is  not  sufficient  to  relieve  the  possessor  from 
dependence  on  wages,  the  condition  of  a  proprietor  loses  much 
of  its  characteristic  efficacy  as  a  check  to  over-population:  and 
if  the  prediction  so  often  made  in  England  had  been  realized, 
and  France  had  become  a  “  pauper  warren,”  the  experiment 
would  have  proved  nothing  against  the  tendencies  of  the  same 
system  of  agricultural  economy  in  other  circumstances.  But 
what  is  the  fact?  That  the  rate  of  increase  of  the  French  popula¬ 
tion  is  the  slowest  in  Europe.  During  the  generation  which  the 
Revolution  raised  from  the  extreme  of  hopeless  wretchedness  to 
sudden  abundance,  a  great  increase  of  population  took  place. 
But  a  generation  has  grown  up,  which,  having  been  born  in  im¬ 
proved  circumstances,  has  not  learnt  to  be  miserable;  and  upon 
them  the  spirit  of  thrift  operates  most  conspicuously,  in  keep¬ 
ing  the  increase  of  population  within  the  increase  of  national 
wealth.  In  a  table,  drawn  up  by  Professor  Rau,  of  the  rate  of 
annual  increase  of  the  populations  of  various  countries,  that  of 
France,  from  1817  to  1827,  is  stated  at  0.63  per  cent.,  that  of 
England  during  a  similar  decennial  period  being  1.6  annually. 


PEASANT  PROPRIETORS 


283 


and  that  of  the  United  States  nearly  3.*  According  to  the  official 
returns  as  analyzed  by  M.  Legoyt,f  the  increase  of  the  popula¬ 
tion,  which  from  1801  to  1806  was  at  the  rate  of  1.28  per  cent, 
annually,  averaged  only  0.47  per  cent,  from  1806  to  1831 ;  from 
1831  to  1836  it  averaged  0.60  per  cent.;  from  1836  to  1841,  0.41 
per  cent.,  and  from  1841  to  1846,  0.68  per  cent.J  At  the  census 
of  1851  the  rate  of  annual  increase  shown  was  only  1.08  per 
cent,  in  the  five  years,  or  0.21  annually;  and  at  the  census  of 
1856  only  0.71  per  cent,  in  five  years,  or  0.14  annually;  so,  that, 
in  the  words  of  M.  de  Lavergne,  “  population  has  almost  ceased 
to  increase  in  France.”  §  Even  this  slow  increase  is  wholly  the 
effect  of  a  diminution  of  deaths;  the  number  of  births  not  in¬ 
creasing  at  all,  while  the  proportion  of  the  births  to  the  popula- 


*  The  following  is  the  table  (see  p.  168 
of  the  Belgian  translation  of  Mr.  Rau’s 
large  work) : 

Per  cent. 

United  States  . . 1820-30 -  2.92 

Hungary  (according  to  Rohrer) -  2.40 

England  . 1811-21 -  1.78 

“  . 1821-31 _  1.60 

Austria  (Rohrer) .  1.30 

Prussia  . 1816-27 -  1.54 

“  . 1820-30 _  1.30 

“  . 1821-31 _  1.27 

Netherlands  . 1821-28 -  1.28 

Scotland  . 1821-31 -  1.30 

Saxony  . 1815-30 -  1.15 

Baden  . 1820-30  (Heunisch)  1.13 

Bavaria  . 1814-28....  1.08 

Naples  . 1814-24 -  0.83 

France  . 1817-27  (Mathieu)  0.63 

and  more  recently  (Moreau  de 
Jonnes  .  0.55 

But  the  number  given  by  Moreau  de 
Jonnes,  he  adds,  is  not  entitled  to  im¬ 
plicit  confidence. 

The  following  table  given  by  M.  Que- 
telet  (“  On  Man  and  the  Development 
of  his  Faculties,”  vol.  i.  chap.  7),  also  on 
the  authority  of  Rau,  contains  addi¬ 

tional  matter,  and  differs  in  some  items 
from  the  preceding,  probably  from  the 
author’s  having  taken,  in  those  cases, 
an  average  of  different  years: 

Per  cent. 


Ireland  .  2.45 

Hungary  .  2.40 

Spain  .  1 .66 

England  . 1.65 

Rhenish  Prussia  .  1.33 

Austria  .  1.30 

Bavaria  .  1.08 

Netherlands  .  0.94 

Naples  .  0.83 

France  .  0.63 

Sweden  .  0.58 

Lombardy  .  0.45 


A  very  carefully  prepared  statement, 
by  M.  Legoyt,  in  the  “  Journal  des 
Economistes  ”  for  May,  1847,  which 


brings  up  the  results  for  France  to  the 
census  of  the  preceding  year,  1846,  is 
summed  up  in  the  following  table: 


Countries 

According 
to  the 
census 

According  to 
the  excess 
of  births 

over  deaths 

Per  cent. 

Per  cent. 

Sweden . 

0.83 

1.14 

Norway . 

1.36 

1.30 

Denmark . 

•  •  •  • 

°-95 

Russia . 

0.61 

Austria . 

0  85 

0.90 

Prussia . 

I  .84 

1. 18 

Saxony . 

i-45 

0.90 

Hanover . 

0.85 

Bavaria . 

O.7I 

Wurtemberg . 

O.OI 

I  .OO 

Holland . 

0.90 

1.03 

Belgium . 

•  •  • 

0.76 

Sardinia . 

1.08 

Great  Britain  (exclu¬ 
sive  of  Ireland) .... 

j-  1-95 

I  .OO 

France . 

0.68 

0.50 

United  States . 

3-27 

t  “  Journal  des  Economistes  ”  for 
March  and  May,  1847. 

$  M.  Legoyt  is  of  opinion  that  the 
population  was  understated  in  1841,  and 
the  increase  between  that  time  and  1846 
consequently  overstated,  and  that  the 
real  increase  during  the  whole  period 
was  something  intermediate  between  the 
last  two  averages,  or  not  much  more 
than  one  in  two  hundred. 

§  “  Journal  des  Economistes  ”  for 
February,  1847.  In  the  “  Journal  ”  for 
January,  1865,  M.  Legoyt  gives  some  of 
the  numbers  slightly  altered,  and,  I 
presume,  corrected.  The  series  of  per¬ 
centages  is  1.28,  0.31,  0.69,  0.60,  0.41,  0.68, 
0.22,  and  0.20.  The  last  census,  that  of 
1861,  shows  a  slight  reaction,  the  per¬ 
centage,  independently  of  the  newly  ac¬ 
quired  departments,  being  0.32. 


284 


POLITICAL  ECONOMY 


tion  is  constantly  diminishing.*  This  slow  growth  of  the  num¬ 
bers  of  the  people,  while  capital  increases  much  more  rapidly, 
has  caused  a  noticeable  improvement  in  the  condition  of  the  la¬ 
boring  class.  The  circumstances  of  that  portion  of  the  class 
who  are  landed  proprietors  are  not  easily  ascertained  with  preci¬ 
sion,  being  of  course  extremely  variable:  but  the  mere  laborers, 
who  derived  no  direct  benefit  from  the  changes  in  landed  prop¬ 
erty  which  took  place  at  the  Revolution,  have  unquestionably 
much  improved  in  condition  since  that  period,  f  Dr.  Rau  testi- 


*  The  following  are  the  numbers  given  by  M.  Legoyt: 

From  1824  to  1828  annual  number  of  births  981,914,  being  1  in  32.30  of  the  population. 


1829  to  1833 
“  1834  to  1838 

“  1839  to  1843 

“  1844  &  1845 


965,444, 

972,993, 

970,617, 

983,573, 


<< 

(< 


i  in  34.00 
1  in  34.39 
1  in  35.27 
1  in  35.58 


In  the  last  two  years  the  births,  ac¬ 
cording  to  M.  Legoyt,  were  swelled  by 
the  effects  of  a  considerable  immigra¬ 
tion.  “  This  diminution  of  births,”  he 
observes,  “  while  there  is  a  constant, 
though  not  a  rapid  increase  both  of  pop¬ 
ulation  and  of  marriages,  can  only  be 
attributed  to  the  progress  of  prudence 
and  forethought  in  families.  It  was  a 
foreseen  consequence  of  our  civil  and 
social  institutions,  which,  producing  a 
daily  increasing  subdivision  of  fortunes, 
both  landed  and  movable,  call  forth  in 
our  people  the  instincts  of  conservation 
and  of  comfort.” 

In  four  departments,  among  which  are 
two  of  the  most  thriving  in  Normandy, 
the  deaths  even  then  exceeded  the  births. 
The  census  of  1856  exhibits  the  remark¬ 
able  fact  of  a  positive  diminution  in  the 
population  of  54  out  of  the  86  depart¬ 
ments.  A  significant  comment  on  the 
“  pauper-warren  ”  theory.  See  M.  de  La- 
vergne’s  analysis  of  the  returns. 

f  “  The  classes  of  our  population 
which  have  only  wages,  and  are  there¬ 
fore  the  most  exposed  to  indigence, 
are  now  (1846)  much  better  provided 
with  the  necessaries  of  food,  lodging, 
and  clothing,  than  they  were  at  the  be¬ 
ginning  of  the  century.  This  may  be 
proved  by  the  testimony  of  all  persons 
who  can  remember  the  earlier  of  the 
two  periods  compared.  Were  there  any 
doubts  on  the  subject,  they  might  easily 
be  dissipated  by  consulting  old  culti¬ 
vators  and  workmen,  as  I  have  myself 
done  in  various  localities,  without  meet¬ 
ing  with  a  single  contrary  testimony; 
we  may  also  appeal  to  the  facts  collected 
by  an  accurate  observer,  M.  Villerme, 
in  his  ‘  Picture  of  the  Moral  and  Physi¬ 
cal  Condition  of  the  Working  Classes,’ 
book  ii.  chap.  1.”  (“  Researches  on  the 

Causes  of  Indigence,”  by  A.  Clement, 
pp.  84,  85.)  The  same  writer  speaks  (p. 
118)  of  “  the  considerable  rise  which  has 
taken  place  since  1789  in  the  wages  of 
agricultural  day-laborers  ”;  and  adds  the 
following  evidence  of  a  higher  standard 
of  habitual  requirements,  even  in  that 
portion  of  the  town  population,  the  state 
of  which  is  usually  represented  as  most 


deplorable:  “  In  the  last  fifteen  or 
twenty  years  a  considerable  change  has 
taken  place  in  the  habits  of  the  opera¬ 
tives  in  our  manufacturing  towns:  they 
now  expend  much  more  than  formerly 
on  clothing  and  ornament.  .  .  .  Cer¬ 
tain  classes  of  workpeople,  such  as  the 
canuts  of  Lyons  ”  (according  to  all  rep¬ 
resentations,  like  their  counterpart,  our 
handloom  weavers,  the  very  worst  paid 
class  of  artisans),  “  no  longer  show 
themselves,  as  they  did  formerly,  cov¬ 
ered  with  filthy  rags.”  (Page  164.) 

The  preceding  statements  were  given 
in  former  editions  of  this  work,  being 
the  best  to  which  I  had  at  the  time  ac¬ 
cess;  but  evidence,  both  of  a  more  re¬ 
cent,  and  of  a  more  minute  and  precise 
character,  will  now  be  found  in  the  im¬ 
portant  work  of  M.'  Leonce  de  Lavergne. 
“  Rural  Economy  of  France  since  1789.” 
According  to  that  painstaking,  well-in¬ 
formed,  and  most  impartial  inquirer,  the 
average  daily  wages  of  a  French  la¬ 
borer  have  risen,  since  the  commence¬ 
ment  of  the  Revolution,  in  the  ratio  of 
19  to  30,  while,  owing  to  the  more  con¬ 
stant  employment,  the  total  earnings 
have  increased  in  a  still  greater  ratio, 
not  short  of  double.  The  following  are 
the  statements  of  M.  de  Lavergne  (2d 
ed.  p.  57) : 

‘  Arthur  Young  estimates  at  19  sous 
(9V2d.)  the  average  of  a  day’s  wages, 
which  must  now  be  about  1  franc  50 
centimes  (is.  3d.),  and  this  increase  only 
represents  a  part  of  the  improvement. 
Though  the  rural  population  has  re¬ 
mained  about  the  same  in  numbers,  the 
addition  made  to  the  population  since 
1789  having  centred  in  the  towns,  the 
number  of  actual  working  days  has  in¬ 
creased,  first  because,  the  duration  of 
life  having  augmented,  the  number  of 
able-bodied  men  is  greater,  and  next, 
because  labor  is  better  organized,  partly 
through  the  suppression  of  several  festi¬ 
val-holidays,  partly  by  the  mere  effect 
of  a  more  active  demand.  When  we  take 
into  account  the  increased  number  of 
his  working  days,  the  annual  receipts 
of  the  rural  workman  must  have 
doubled.  This  augmentation  of  wages 


PEASANT  PROPRIETORS 


285 


fies  to  a  similar  fact  in  the  case  of  another  country  in  which  the 
subdivision  of  the  land  is  probably  excessive,  the  Palatinate.* 

I  am  not  aware  of  a  single  authentic  instance  which  supports 
the  assertion  that  rapid  multiplication  is  promoted  by  peasant 
properties.  Instances  may  undoubtedly  be  cited  of  its  not  be¬ 
ing  prevented  by  them,  and  one  of  the  principal  of  these  is 
Belgium;  the  prospects  of  which,  in  respect  to  population,  are  at 
present  a  matter  of  considerable  uncertainty.  Belgium  has  the 
most  rapidly  increasing  population  on  the  Continent;  and  when 
the  circumstances  of  the  country  require,  as  they  must  soon  do, 
that  this  rapidity  should  be  checked,  there  will  be  a  considerable 
strength  of  existing  habit  to  be  broken  through.  One  of  the 
unfavorable  circumstances  is  the  great  power  possessed  over  the 
minds  of  the  people  by  the  Catholic  priesthood,  whose  influence 
is  everywhere  strongly  exerted  against  restraining  population. 
As  yet,  however,  it  must  be  remembered  that  the  indefatigable 
industry  and  great  agricultural  skill  of  the  people  have  rendered 
the  existing  rapidity  of  increase  practically  innocuous;  the  great 
number  of  large  estates  still  undivided  affording  by  their  gradual 
dismemberment,  a  resource  for  the  necessary  augmentation  of 
the  gross  produce;  and  there  are,  besides,  many  large  manu¬ 
facturing  towns,  and  mining  and  coal  districts,  which  attract 
and  employ  a  considerable  portion  of  the  annual  increase  of 
population. 

§  5.  But  even  where  peasant  properties  are  accompanied  by 
an  excess  of  numbers,  this  evil  is  not  necessarily  attended  with 
the  additional  economical  disadvantage  of  too  great  a  subdivi¬ 
sion  of  the  land.  It  does  not  follow  because  landed  property 


answers  to  at  least  an  equal  augmenta¬ 
tion  of  comforts,  since  the  prices  of  the 
chief  necessaries  of  life  have  changed 
but  little,  and  those  of  manufactured, 
for  example  of  woven,  articles,  have  ma¬ 
terially  diminished.  The  lodging  of  the 
laborers  has  also  improved,  if  not  in  all, 
at  least  in  most  of  our  provinces.” 

M.  de  Lavergne’s  estimate  of  the  av¬ 
erage  amount  of  a  day’s  wages  is 
grounded  on  a  careful  comparison,  in 
this  and  all  other  economical  points  of 
view,  of  all  the  different  provinces  of 
France. 

*  In  his  little  book  on  the  Agriculture 
of  the  Palatinate,  already  cited.  He  says 
that  the  daily  wages  of  labor,  which  dur¬ 
ing  the  last  years  of  the  war  were  un¬ 
usually  high,  and  so  continued  until  1817, 
afterwards  sank  to  a  lower  money-rate, 
but  that  the  prices  of  many  commodities 
having  fallen  in  a  still  greater  propor¬ 
tion,  the  condition  of  the  people  was  un¬ 


equivocally  improved.  The  food  given 
to  farm  laborers  by  their  employers  has 
also  greatly  improved  in  quantity  and 
quality.  “  It  is  now  considerably  better 
than  about  forty  years  ago,  when  the 
poorer  class  obtained  less  flesh-meat  and 
puddings,  and  no  cheese,  butter,  and  the 
like.”  (P.  20.)  “  Such  an  increase  of 
wages  ”  (adds  the  Professor)  “  which 
must  be  estimated  not  in  money,  but  in 
the  quantity  of  necessaries  and  con¬ 
veniences  which  the  laborer  is  enabled 
to  procure,  is,  by  universal  admission,  a 
proof  that  the  mass  of  capital  must  have 
increased.”  It  proves  not  only  this,  but 
also  that  the  laboring  population  has  not 
increased  in  an  equal  degree;  and  that, 
in  this  instance  as  well  as  in  France,  the 
division  of  the  land,  even  when  exces¬ 
sive,  has  been  compatible  with  a 
strengthening  of  the  prudential  checks 
to  population. 


286 


POLITICAL  ECONOMY 


is  minutely  divided,  that  farms  will  be  so.  As  large  properties 
are  perfectly  compatible  with  small  farms,  so  are  small  prop- 
perties  with  farms  of  an  adequate  size;  and  a  subdivision 
of  occupancy  is  not  an  inevitable  consequence  of  even  un¬ 
due  multiplication  among  peasant  proprietors.  As  might  be 
expected  from  their  admirable  intelligence  in  things  relat¬ 
ing  to  their  occupation,  the  Flemish  peasantry  have  long 
learnt  this  lesson.  “  The  habit  of  not  dividing  properties,”  says 
Dr.  Rau,*  “  and  the  opinion  that  this  is  advantageous,  have 
been  so  completely  preserved  in  Flanders,  that  even  now,  when 
a  peasant  dies  leaving  several  children,  they  do  not  think  of  di¬ 
viding  his  patrimony,  though  it  be  neither  entailed  nor  settled 
in  trust;  they  prefer  selling  it  entire,  and  sharing  the  proceeds, 
considering  it  as  a  jewel  which  loses  its  value  when  it  is  divided.” 
That  the  same  feeling  must  prevail  widely  even  in  France,  is 
shown  by  the  great  frequency  of  sales  of  land,  amounting  in 
ten  years  to  a  fourth  part  of  the  whole  soil  of  the  country;  and 
M.  Passy,  in  his  tract  “  On  the  Changes  in  the  Agricultural  Con¬ 
dition  of  the  Department  of  the  Eure  since  the  year  1800,”  f 
states  other  facts  tending  to  the  same  conclusion.  “  The  ex¬ 
ample,”  says  he,  “  of  this  department  attests  that  there  does  not 
exist,  as  some  writers  have  imagined,  between  the  distribution  of 
property  and  that  of  cultivation,  a  connection  which  tends  in¬ 
vincibly  to  assimilate  them.  In  no  portion  of  it  have  changes 
of  ownership  had  a  perceptible  influence  on  the  size  of  holdings. 
While,  in  districts  of  small  farming,  lands  belonging  to  the  same 
owner  are  ordinarily  distributed  among  many  tenants,  so  neither 
is  it  uncommon,  in  places  where  the  grande  culture  prevails, 
for  the  same  farmer  to  rent  the  lands  of  several  proprietors.  In 
the  plains  of  Vexin,  in  particular,  many  active  and  rich  culti¬ 
vators  do  not  content  themselves  with  a  single  farm;  others  add 
to  the  lands  of  their  principal  holding,  all  those  in  the  neighbor¬ 
hood  which  they  are  able  to  hire,  and  ih  this  manner  make  up  a 
total  extent  which  in  some  cases  reaches  or  exceeds  two  hundred 
hectares  ”  (five  hundred  England  acres).  “  The  more  the  es¬ 
tates  are  dismembered,  the  more  frequent  do  this  sort  of  ar¬ 
rangements  become;  and  as  they  conduce  to  the  interest  of 
all  concerned,  it  is  probable  that  time  will  confirm  them.” 

*  Page  334  of  the  Brussels  translation.  cipal  political  economists  of  France, 

He  cites  as  an  authority,  Schwerz,  “  Pa-  and  doing  great  and  increasing  honor 

pers  on  Agriculture,”  i.  185.  to  their  knowledge  and  ability.  M. 

t  One  of  the  many  important  papers  Passy’s  essay  has  been  reprinted  sep* 

which  have  appeared  in  the  “  Journal  arately  as  a  pamphlet, 
des  Economistes,”  the  organ  of  the  prin- 


PEASANT  PROPRIETORS 


287 


“  In  some  places,”  says  M.  de  Lavergne,*  “  in  the  neighbor¬ 
hood  of  Paris,  for  example,  where  the  advantages  of  the  grande 
culture  become  evident,  the  size  of  farms  tends  to  increase,  sev¬ 
eral  farms  are  thrown  together  into  one,  and  farmers  enlarge 
their  holdings  by  renting  parcelles  from  a  number  of  different 
proprietors.  Elsewhere  farms  as  well  as  properties  of  too  great 
extent,  tend  to  division.  Cultivation  spontaneously  finds  out  the 
organization  which  suits  it  best.”  It  is  a  striking  fact,  stated  by 
the  same  eminent  writer, f  that  the  departments  which  have  the 
greatest  number  of  small  separate  accounts  with  the  tax-col¬ 
lector,  are  the  Nord,  the  Somme,  the  Pas  de  Calais,  the  Seine 
Inferieure,  the  Aisne,  and  the  Oise;  all  of  them  among  the  rich¬ 
est  and  best  cultivated,  and  the  first-mentioned  of  them  the  very 
richest  and  best  cultivated,  in  France. 

Undue  subdivision,  and  excessive  smallness  of  holdings,  are 
undoubtedly  a  prevalent  evil  in  some  countries  of  peasant  pro¬ 
prietors,  and  particularly  in  parts  of  Germany  and  France.  The 
gov'ernments  of  Bavaria  and  Nassau  have  thought  it  necessary 
to  impose  a  legal  limit  to  subdivision,  and  the  Prussian  Govern¬ 
ment  unsuccessfully  proposed  the  same  measure  to  the  Estates 
of  its  Rhenish  Provinces.  But  I  do  not  think  it  will  anywhere 
be  found  that  the  petite  culture  is  the  system  of  the  peasants, 
and  the  grande  culture  that  of  the  great  landlords :  on  the 
contrary,  wherever  the  small  properties  are  divided  among  too 
many  proprietors,  I  believe  it  to  be  true  that  the  large  proper¬ 
ties  also  are  parcelled  out  among  too  many  farmers,  and  that 
the  cause  is  the  same  in  both  cases,  a  backward  state  of  capital, 
skill,  and  agricultural  enterprise.  There  is  reason  to  believe  that 
the  subdivision  in  France  is  not  more  excessive  than  is  ac¬ 
counted  for  by  this  cause;  that  it  is  diminishing,  not  increasing; 
and  that  the  terror  expressed  in  some  quarters  at  the  progress 
of  the  morcellementj  is  one  of  the  most  groundless  of  real  or 
pretended  panics. J 


*  “  Rural  Economy  of  France,”  p.  455. 
t  Page  1 17.  See,  for  facts  of  a  similar 
tendency,  pp.  141,  250,  and  other  pas¬ 
sages  of  the  same  important  treatise; 
which,  on  the  other  hand,  equally 
abounds  with  evidence  of  the  mischiev¬ 
ous  effect  of  subdivision  when  too 
minute,  or  when  the  nature  of  the  soil 
and  of  its  products  is  not  suitable  to  it. 

t  Mr.  Laing,  in  his  latest  publication, 
“  Observations  on  the  Social  and  Po¬ 
litical  State  of  the  European  People  in 
1848  and  1849,”  a  book  devoted  to  the 
glorification  of  England,  and  the  dis¬ 


paragement  of  everything  elsewhere 
which  others,  or  even  he  himself  in 
former  works,  had  thought  worthy  of 
praise,  argues  that  “  although  the  land 
itself  is  not  divided  and  subdivided  ” 
on  the  death  of  the  proprietor,  “  the 
value  of  the  land  is,  and  with  effects  al¬ 
most  as  prejudicial  to  social  progress. 
The  value  of  each  share  becomes  a 
debt  or  burden  upon  the  land.”  Con¬ 
sequently  the  condition  of  the  agricul¬ 
tural  population  is  retrograde:  ?‘  each 
generation  is  worse  off  than  the  pre¬ 
ceding  one,  although  the  land  is  neither 


288 


POLITICAL  ECONOMY 


If  peasant  properties  have  any  effect  in  promoting  subdivision 
beyond  the  degree  which  corresponds  to  the  agricultural  prac¬ 
tices  of  the  country,  and  which  is  customary  on  its  large  estates, 
the  cause  must  lie  in  one  of  the  salutary  influences  of  the  system; 
the  eminent  degree  in  which  it  promotes  providence  on  the  part 
of  these  who,  not  being  yet  peasant  proprietors,  hope  to  become 
so.  In  England,  where  the  agricultural  laborer  has  no  invest¬ 
ment  for  his  savings  but  the  savings  bank,  and  no  position  to 
which  he  can  rise  by  any  exercise  of  economy,  except  perhaps 
that  of  a  petty  shopkeeper,  with  its  chances  of  bankruptcy,  there 
is  nothing  at  all  resembling  the  intense  spirit  of  thrift  which 
takes  possession  of  one  who,  from  being  a  day  laborer,  can  raise 
himself  by  saving  to  the  condition  of  a  landed  proprietor.  Ac¬ 
cording  to  almost  all  authorities,  the  real  cause  of  the  mor- 
cellement  is  the  higher  price  which  can  be  obtained  for  land  by 
selling  it  to  the  peasantry,  as  an  investment  for  their  small  ac¬ 
cumulations,  than  by  disposing  of  it  entire  to  some  rich  pur¬ 
chaser  who  has  no  object  but  to  live  on  its  income  without  im¬ 
proving  it.  The  hope  of  obtaining  such  an  investment  is  the  most 
powerful  of  inducements,  to  those  who  are  without  land,  to  prac¬ 
tice  the  industry,  frugality,  and  self-restraint,  on  which  their 
success  in  this  object  of  ambition  is  dependent. 

As  the  result  of  this  inquiry  into  the  direct  operation  and  in¬ 
direct  influences  of  peasant  properties,  I  conceive  it  to  be  es¬ 
tablished,  that  there  is  no  necessary  connection  between  this 
form  of  landed  property  and  an  imperfect  state  of  the  arts  of 
production;  that  it  is  favorable  in  quite  as  many  respects  as  it  is 
unfavorable,  to  the  most  effective  use  of  the  powers  of  the  soil; 
that  no  other  existing  state  of  agricultural  economy  has  so 
beneficial  an  effect  on  the  industry,  the  intelligence,  the  frugality, 
and  prudence  of  the  population,  nor  tends  on  the  whole  so  much 


less  nor  more  divided,  nor  worse  culti¬ 
vated.”  And  this  he  gives  as  the  ex¬ 
planation  of  the  great  indebtedness  of 
the  small  landed  proprietors  in  France 
(pp.  97 — 9).  If  these  statements  were  cor¬ 
rect,  they  would  invalidate  all  which  Mr. 
Laing  affirmed  so  positively  in  other 
writings,  and  repeats  in  this,  respecting 
the  peculiar  efficacy  of  the  possession  of 
land  in  preventing  over-population.  But 
he  is  entirely  mistaken  as  to  the  matter 
of  fact.  In  the  only  country  of  which 
he  speaks  from  actual  residence,  Nor¬ 
way,  he  does  not  pretend  that  the  con¬ 
dition  of  the  peasant  proprietors  is  de¬ 
teriorating.  The  facts  already  cited 
prove  that  in  respect  to  Belgium,  Ger¬ 


many,  anc^  Switzerland,  the  assertion  is 
equally  wide  of  the  mark;  and  what  has 
been  shown  respecting  the  slow  increase 
of  population  in  France,  demonstrates 
that  if  the  condition  of  the  French  peas¬ 
antry  was  deteriorating,  it  could  not  be 
from  the  cause  supposed  by  Mr.  Laing. 
The  truth  I  believe  to  be  that  in  every 
country  without  exception,  in  which 
peasant  properties  prevail,  the  condition 
of  the  people  is  improving,  the  produce 
of  the  land  and  even  its  fertility  increas¬ 
ing,  and  from  the  larger  surplus  which 
remains  after  feeding  the  agricultural 
classes,  the  towns  are  augmenting  both 
in  population  and  in  the  well-being  of 
their  inhabitants. 


METAYERS 


289 


to  discourage  an  improvident  increase  of  their  numbers;  and 
that  no  existing  state,  therefore,  is  on  the  whole  so  favorable, 
both  to  their  moral  and  their  physical  welfare.  Compared  with 
the  English  system  of  cultivation  by  hired  labor,  it  must  be  re¬ 
garded  as  eminently  beneficial  to  the  laboring  class.*  We  are 
not  on  the  present  occasion  called  upon  to  compare  it  with  the 
joint  ownership  of  the  land  by  associations  of  laborers. 


Chapter  VIII. — Of  Metayers 


§  1.  From  the  case  in  which  the  produce  of  land  and  labor 
belongs  undividedly  to  the  laborer,  we  proceed  to  the  cases  in 
which  it  is  divided,  but  between  two  classes  only,  the  laborers 
and  the  landowners ;  the  character  of  capitalists  merging  in 
the  one  or  the  other,  as  the  case  may  be.  It  is  possible  indeed 
to  conceive  that  there  might  be  only  two  classes  of  persons  to 
share  the  produce,  and  that  a  class  of  capitalists  might  be  one 
of  them ;  the  character  of  laborer  and  that  of  landowner  being 
united  to  form  the  other.  This  might  occur  in  two  ways.  The 
laborers,  though  owning  the  land,  might  let  it  to  a  tenant,  and 
work  under  him  as  hired  servants.  But  this  arrangement, 
even  in  the  very  rare  cases  which  could  give  rise  to  it,  would 
not  require  any  particular  discussion,  since  it  would  not  differ 


*  French  history  strikingly  confirms 
these  conclusions.  Three  times  during 
the  course  of  ages  the  peasantry  have 
been  purchasers  of  land;  and  these  times 
immediately  preceded  the  three  princi¬ 
pal  eras  of  French  agricultural  pros¬ 
perity. 

“  In  the  worst  times,”  says  the  his¬ 
torian  Michelet  (“  The  People,”  Part  i. 
chap.  1),  “  the  times  of  universal  pov¬ 
erty,  when  even  the  rich  are  poor  and 
obliged  to  sell,  the  poor  are  enabled  to 
buy:  no  other  purchaser  presenting  him¬ 
self,  the  peasant  in  rags  arrives  with  his 

fiiece  of  gold,  and  acquires  a  little  bit  of 
and.  These  moments  of  disaster  in 
which  the  peasant  was  able  to  buy  land 
at  a  low  price,  have  always  been  fol¬ 
lowed  by  a  sudden  gush  of  prosperity 
which  people  could  not  account  for. 
Towards  1500,  for  example,  when  France, 
exhausted  by  Louis  XI,  seemed  to  be 
completing  its  ruin  in  Italy,  the  noblesse 
who  went  to  the  wars  were  obliged  to 
sell:  the  land,  passing  into  new  hands, 
suddenly  began  to  flourish;  men  began 
to  labor  and  to  build.  This  happy  mo¬ 
ment,  in  the  style  of  courtly  historians, 
was  called  the  good  Louis  XII. 

“  Unhappily  it  did  not  last  long. 
Scarcely  had  the  land  recovered  itself 
when  the  tax-collector  fell  upon  it;  the 

VOL.  I. — 19 


wars  of  religion  followed,  and  seemed 
to  raze  everything  to  the  ground;  with 
horrible  miseries,  dreadful  famines,  in 
which  mothers  devoured  their  children. 
Who  would  believe  that  the  country  le- 
covered  from  this?  Scarcely  is  the  war 
ended,  when  from  the  devastated  fields, 
and  the  cottages  still  black  with  the 
flames,  comes  forth  the  hoard  of  the 
peasant.  He  buys;  in  ten  years,  France 
wears  a  new  face;  in  twenty  or  thirty, 
all  possessions  have  doubled  and 
trebled  in  value.  This  moment,  again 
baptized  by  a  royal  name,  is  called  the 
good  Henry  IV  and  the  great  Riche¬ 
lieu.” 

Of  the  third  era  it  is  needless  again 
to  speak;  it  was  that  of  the  Revolution. 

Whoever  would  study  the  reverse  of 
the  picture,  may  compare  these  historic 

eriods,  characterized  by  the  dismem- 

erment  of  large  and  the  construction 
of  small  properties,  with  the  wide-spread 
national  suffering  which  accompanied, 
and  the  permanent  deterioration  of  the 
condition  of  the  laboring  classes  which 
followed,  the  “  clearing  away  of  small 
yeomen  to  make  room  for  large  grazing 
farms,  which  was  the  grand  economical 
event  of  English  history  during  the  six¬ 
teenth  century. 


290 


POLITICAL  ECONOMY 


in  any  material  respect  from  the  threefold  system  of  laborers, 
capitalists,  and  landlords.  The  other  case  is  the  not  uncom¬ 
mon  one,  in  which  a  peasant  proprietor  owns  and  cultivates 
the  land,  but  raises  the  little  capital  required,  by  a  mortgage 
upon  it.  Neither  does  this  case  present  any  important  peculiar¬ 
ity.  There  is  but  one  person,  the  peasant  himself,  who  has  any 
right  or  power  of  interference  in  the  management.  He  pays  a 
fixed  annuity  as  interest  to  a  capitalist,  as  he  pays  another 
fixed  sum  in  taxes  to  the  government.  Without  dwelling 
further  on  these  cases,  we  pass  to  those  which  present  marked 
features  of  peculiarity. 

When  the  two  parties  sharing  in  the  produce  are  the  laborer 
or  laborers  and  the  landowner,  it  is  not  a  very  material  circum¬ 
stance  in  the  case,  which  of  the  two  furnishes  the  stock,  or 
whether,  as  sometimes  happens,  they  furnish  it,  in  a  determinate 
proportion,  between  them.  The  essential  difference  does  not 
lie  in  this,  but  in  another  circumstance,  namely,  whether  the 
division  of  the  produce  between  the  two  is  regulated  by  cus¬ 
tom  or  by  competition.  We  will  begin  with  the  former  case; 
of  which  the  metayer  culture  is  the  principal,  and  in  Europe 
almost  the  sole,  example. 

The  principle  of  the  metayer  system  is  that  the  laborer,  or 
peasant,  makes  his  engagement  directly  with  the  landowner, 
and  pays,  not  a  fixed  rent,  either  in  money  or  in  kind,  but  a  cer¬ 
tain  proportion  of  the  produce,  or  rather  of  what  remains  of  the 
produce  after  deducting  what  is  considered  necessary  to  keep 
up  the  stock.  The  proportion  is  usually,  as  the  name  imports, 
one-half ;  but  in  several  districts  in  Italy  it  is  two-thirds.  Re¬ 
specting  the  supply  of  stock,  the  custom  varies  from  place  to 
place ;  in  some  places  the  landlord  furnishes  the  whole,  in 
others  half,  in  others  some  particular  part,  as  for  instance  the 
cattle  and  seed,  the  laborer  providing  the  implements.*  “  This 


*  In  France,  before  the  Revolution, 
according  to  Arthur  Young  (1. 403)  there 
was  great  local  diversity  in  this  respect. 
In  Champagne,  “  the  landlord  common¬ 
ly  finds  half  the  cattle  and  half  the  seed, 
and  the  metayer,  labor,  implements,  and 
taxes;  but  in  some  districts  the  landlord 
bears  a  share  of  these.  In  Roussillon, 
the  landlord  pays  half  the  taxes;  and  in 
Guienne,  from  Auch  to  Fleuran,  many 
landlords  pay  all.  Near  Aguillon,  on 
the  Garonne,  the  metayers  furnish  half 
the  cattle.  At  Nangis,  in  the  Isle  of 
France,  I  met  with  an  agreement  for  the 
landlord  to  furnish  live  stock,  imple¬ 
ments,  harness,  and  taxes;  the  metayer 
found  labor  and  his  own  capitation  tax: 


the  landlord  repaired  the  house  and 
gates;  the  metayer  the  windows:  the 
landlord  provided  seed  the  _  first  year, 
the  metayer  the  last;  in  the  intervening 
years  they  supply  half  and  half.  In  the 
Bourbonnois  the  landlord  finds  all  sorts 
of  live  stock,  yet  the  metayer  sells, 
changes,  and  buys  at  his  will;  the  stew¬ 
ard  keeping  an  account  of  these  muta¬ 
tions,  for  the  landlord  has  half  the 
product  of  sales,  and  pays  half  the  pur¬ 
chases.”  In  Piedmont,  he  says,  “  the 
landlord  commonly  pays  the  taxes  and 
repairs  the  buildings,  and  the  tenant 
provides  cattle,  implements,  and  seed.” 

(II.  151.) 


METAYERS 


291 


connection/’  says  Sismondi,  speaking  chiefly  of  Tuscany,*  “  is 
often  the  subject  of  a  contract,  to  define  certain  services  and 
certain  occasional  payments  to  which  the  metayer  binds  him¬ 
self  ;  nevertheless  the  differences  in  the  obligations  of  one  such 
contract  and  another  are  inconsiderable ;  usage  governs  alike 
all  these  engagements,  and  supplies  the  stipulations  which  have 
not  been  expressed :  and  the  landlord  who  attempted  to  de¬ 
part  from  usage,  who  exacted  more  than  his  neighbor,  who 
took  for  the  basis  of  the  agreement  anything  but  the  equal  divi¬ 
sion  of  the  crops,  would  render  himself  so  odious,  he  would  be 
so  sure  of  not  obtaining  a  metayer  who  was  an  honest  man, 
that  the  contract  of  all  the  metayers  may  be  considered  as  iden¬ 
tical,  at  least  in  each  province,  and  never  gives  rise  to  any  com¬ 
petition  among  peasants  in  search  of  employment,  or  any  offer 
to  cultivate  the  soil  on  cheaper  terms  than  one  another.”  To 
the  same  effect  Chateauvieux,f  speaking  of  the  metayers  of 
Piedmont.  “  They  consider  it  ”  (the  farm)  “  as  a  patrimony, 
and  never  think  of  renewing  the  lease,  but  go  on  from  genera¬ 
tion  to  generation,  on  the  same  terms,  without  writings  or 
registries.”  J 

§  2.  When  the  partition  of  the  produce  is  a  matter  of  fixed 
usage,  not  of  varying  convention,  political  economy  has  no 
laws  of  distribution  to  investigate.  It  has  only  to  consider, 
as  in  the  case  of  peasant  proprietors,  the  effects  of  the  system, 
first,  on  the  condition  of  the  peasantry,  morally  and  physically, 
and  secondly,  on  the  efficiency  of  the  labor.  In  both  these  par¬ 
ticulars  the  metayer  system  has  the  characteristic  advantages 
of  peasant  properties,  but  has  them  in  a  less  degree.  The  me¬ 
tayer  has  less  motive  to  exertion  than  the  peasant  proprietor, 
since  only  half  the  fruits  of  his  industry,  instead  of  the  whole, 
are  his  own.  But  he  has  a  much  stronger  motive  than  a  day 
laborer,  who  has  no  other  interest  in  the  result  than  not  to  be 
dismissed.  If  the  metayer  cannot  be  turned  out  except  for 


*  “  Studies  in  Political  Economy,” 
Essay  VI.  On  the  Condition  of  the 
Cultivators  in  Tuscany. 

t  “  Letters  from  Italy.”  I  quote  from 
Dr.  Rigby’s  translation.  (P.  22.) 

t  This  virtual  fixity  of  tenure  is  not, 
however,  universal,  even  in  Italy;  and 
it  is  to  its  absence  that  Sismondi  attrib¬ 
utes  the  inferior  condition  of  the  metay¬ 
ers  in  some  provinces  of  Naples,  in 
Lucca,  and  in  the  Riviera  of  Genoa; 
where  the  landlords  obtain  a  larger 
(though  still  a  fixed)  share  of  the 


produce.  In  those  countries  the  culti¬ 
vation  is  splendid,  but  the  people  wretch¬ 
edly  poor.  “  The  same  misfortune  would 
probably  have  befallen  the  people  of 
Tuscany  if  public  opinion  did  not  pro¬ 
tect  the  cultivator;  but  a  proprietor 
would  not  dare  to  impose  conditions  un¬ 
usual  in  the  country,  and  even  in  chang¬ 
ing  one  metayer  for  another,  he  alters 
nothing  in  the  terms  of  the  engage¬ 
ment.” — “  New  Principles  of  Political 
Economy,”  book  iii.  chap.  5. 


292 


POLITICAL  ECONOMY 


some  violation  of  his  contract,  he  has  a  stronger  motive  to  ex¬ 
ertion  than  any  tenant-farmer  who  has  not  a  lease.  The  me¬ 
tayer  is  at  least  his  landlord’s  partner,  and  a  half-sharer  in  their 
joint  gains.  Where,  too,  the  permanence  of  his  tenure  is  guar¬ 
anteed  by  custom,  he  acquires  local  attachments,  and  much  of 
the  feelings  of  a  proprietor.  I  am  supposing  that  this  half 
produce  is  sufficient  to  yield  him  a  comfortable  support. 
Whether  it  is  so,  depends  (in  any  given  state  of  agriculture) 
on  the  degree  of  subdivision  of  the  land ;  which  depends  on  the 
operation  of  the  population  principle.  A  multiplication  of 
people,  beyond  the  number  that  can  be  properly  supported  on 
the  land  or  taken  off  by  manufactures,  is  incident  even  to  a 
peasant  proprietary,  and  of  course  not  less  but  rather  more  in¬ 
cident  to  a  metayer  population.  The  tendency,  however,  which 
we  noticed  in  the  proprietary  system,  to  promote  prudence  on 
this  point,  is  in  no  small  degree  common  to  it  with  the  metayer 
system.  There,  also,  it  is  a  matter  of  easy  and  exact  calculation 
whether  a  family  can  be  supported  or  not.  If  it  is  easy  to  see 
whether  the  owner  of  the  whole  produce  can  increase  the  pro¬ 
duction  so  as  to  maintain  a  greater  number  of  persons  equally 


well,  it  is  a  not  less  simple  problem  whether  the  owner  of  half 
the  produce  can  do  so.*  There  is  one  check  which  this  system 
seems  to  offer,  over  and  above  those  held  out  even  by  the  pro¬ 
prietary  system ;  there  is  a  landlord,  who  may  exert  a  con¬ 
trolling  power,  by  refusing  his  consent  to  a  subdivision.  I  do 
not,  however,  attach  great  importance  to  this  check,  because 
the  farm  may  be  loaded  with  superfluous  hands  without  being 
subdivided ;  and  because,  so  long^  as  the  increase  of  hands  in¬ 
creases  the  gross  produce,  which  is  almost  always  the  case,  the 
landlord,  who  receives  half  the  produce,  is  an  immediate  gainer, 
the  inconvenience  falling  only  on  the  laborers.  The  landlord 


is  no  doubt  liable  in  the  end  to  suffer  from  their  poverty,  by 


*  M.  Bastiat  affirms  that  even  in 
France,  incontestably  the  least  favor¬ 
able  example  of  the  metayer  system,  its 
effect  in  repressing  population  is  con¬ 
spicuous.  “  It  is  a  well-ascertained  fact 
that  the  tendency  to  excessive  multipli¬ 
cation  is  chiefly  manifested  in  the  class 
who  live  on  wages.  Over  these  the  fore¬ 
thought  which  retards  marriages  has  lit¬ 
tle  operation,  because  the  evils  which 
flow  from  excessive  competition  appear 
to  them  only  very  confusedly,  and  at  a 
considerable  distance.  It  is,  therefore, 
the  most  advantageous  condition  of  a 
people  to  be  so  organized  as  to  contain 
no  regular  class  of  laborers  for  hire.  In 
metayer  countries,  marriages  are  prin¬ 


cipally  determined  by  the  demands  of 
cultivation;  they  increase  when,  from 
whatever  cause,  the  metairies  offer  va¬ 
cancies  injurious  to  production;  they  di¬ 
minish  when  the  places  are  filled  up.  A 
fact  easily  ascertained,  the  proportion 
between  the  size  of  the  farm  and  the 
number  of  hands,  operates  like  fore¬ 
thought,  and  with  greater  effect.  We 
find,  accordingly,  that  when  nothing 
occurs  to  make  an  opening  for  a  su¬ 
perfluous  population,  numbers  remain 
stationary:  as  is  seen  in  our  southern  de¬ 
partments.” — “  Considerations  on  Metay¬ 
age,”  in  the  “  Journal  des  Economistes  ” 
for  February,  1846. 


METAYERS 


293 


being  forced  to  make  advances  to  them,  especially  in  bad  sea¬ 
sons  ;  and  a  foresight  of  this  ultimate  inconvenience  may 
operate  beneficially  on  such  landlords  as  prefer  future  security 
to  present  profit. 

The  characteristic  disadvantage  of  the  metayer  system  is 
very  fairly  stated  by  Adam  Smith.  After  pointing  out  that 
metayers  “  have  a  plain  interest  that  the  whole  produce  should 
be  as  great  as  possible,  in  order  that  their  own  proportion  may 
be  so,”  he  continues,*  “  it  could  never,  however,  be  the  interest 
of  this  species  of  cultivators  to  lay  out,  in  the  further  improve¬ 
ment  of  the  land,  any  part  of  the  little  stock  which  they  might 
save  from  their  own  share  of  the  produce,  because  the  lord,  who 
laid  out  nothing,  was  to  get  one-half  of  whatever  it  produced. 
The  tithe,  which  is  but  a  tenth  of  the  produce,  is  found  to  be  a 
very  great  hindrance  to  improvement.  A  tax,  therefore,  which 
amounted  to  one-half,  must  have  been  an  effectual  bar  to  it. 
It  might  be  the  interest  of  a  metayer  to  make  the  land  produce 
as  much  as  could  be  brought  out  of  it  by  means  of  the  stock 
furnished  by  the  proprietor ;  but  it  could  never  be  his  interest 
to  mix  any  part  of  his  own  with  it.  In  France,  where  five  parts 
out  of  six  of  the  whole  kingdom  are  said  to  be  still  occupied 
by  this  species  of  cultivators,  the  proprietors  complain  that 
their  metayers  take  every  opportunity  of  employing  the  mas¬ 
ter’s  cattle  rather  in  carriage  than  in  cultivation  ;  because  in  the 
one  case  they  get  the  whole  profits  to  themselves,  in  the  other 
they  share  them  with  their  landlord.” 

It  is  indeed  implied  in  the  very  nature  of  the  tenure,  that  all 
improvements  which  require  expenditure  of  capital,  must  be 
made  with  the  capital  of  the  landlord.  This,  however,  is  es¬ 
sentially  the  case  even  in  England,  whenever  the  farmers  are 
tenants-at-will :  or  (if  Arthur  Young  is  right)  even  on  a  “  nine 
years’  lease.”  If  the  landlord  is  willing  to  provide  capital  for 
improvements,  the  metayer  has  the  strongest  interest  in  pro¬ 
moting  them,  since  half  the  benefit  of  them  will  accrue  to  him¬ 
self.  As  however  the  perpetuity  of  tenure  which,  in  the  case 
we  are  discussing,  he  enjoys  by  custom,  renders  his  consent  a 
necessary  condition ;  the  spirit  of  routine,  and  dislike  of  inno¬ 
vation,  characteristic  of  an  agricultural  people  when  not  cor¬ 
rected  by  education,  are  no  doubt,  as  the  advocates  of  the  sys¬ 
tem  seem  to  admit,  a  serious  hindrance  to  improvement. 

*  “  Wealth  of  Nations,”  book  iii.,  chap.  a. 


294 


POLITICAL  ECONOMY 


§  3.  The  metayer  system  has  met  with  no  mercy  from  Eng¬ 
lish  authorities.  “  There  is  not  one  word  to  be  said  in  favor 
of  the  practice/’  says  Arthur  Young,* * * §  “  and  a  thousand  argu¬ 
ments  that  might  be  used  against  it.  The  hard  plea  of  necessity 
can  alone  be  urged  in  its  favor;  the  poverty  of  the  farmers 
being  so  great,  that  the  landlord  must  stock  the  farm,  or  it 
could  not  be  stocked  at  all:  this  is  a  most  cruel  burden  to  a 
proprietor,  who  is  thus  obliged  to  run  much  of  the  hazard  of 
farming  in  the  most  dangerous  of  all  methods,  that  of  trusting 
his  property  absolutely  in  the  hands  of  people  who  are  generally 
ignorant,  many  careless,  and  some  undoubtedly  wicked.  .  .  . 
In  this  most  miserable  of  all  the  modes  of  letting  land,  the  de¬ 
frauded  landlord  receives  a  contemptible  rent ;  the  farmer  is  in 
the  lowest  state  of  poverty ;  the  land  is  miserably  cultivated ; 
and  the  nation  suffers  as  severely  as  the  parties  themselves. 
.  .  .  Wherever  f  this  system  prevails,  it  may  be  taken  for 

granted  that  a  useless  and  miserable  population  is  found.  .  .  . 
Wherever  the  country  (that  I  saw)  is  poor  and  unwatered,  in 
the  Milanese,  it  is  in  the  hands  of  metayers:  ”  they  are  almost 
always  in  debt  to  their  landlord  for  seed  or  food,  and  “  their 
condition  is  more  wretched  than  that  of  a  day  laborer.  .  .  . 
There  J  are  but  few  districts  ”  (in  Italy)  “  where  lands  are  let 
to  the  ocupying  tenant  at  a  money-rent;  but  wherever  it  is 
found,  their  crops  are  greater;  a  clear  proof  of  the  imbecility 
of  the  metaying  system.”  “  Wherever  it  ”  (the  metayer  sys¬ 
tem)  “  has  been  adopted,”  says  Mr.  M’Culloch,§  “  it  has  put  a 
stop  to  all  improvement,  and  has  reduced  the  cultivators  to 
the  most  abject  poverty.”  Mr.  Jones  ||  shares  the  common 
opinion,  and  quotes  Turgot  and  Destutt-Tracy  in  support  of 
it.  The  impression,  however,  of  all  these  writers  (notwith¬ 
standing  Arthur  Young’s  occasional  references  to  Italy)  seems 
to  be  chiefly  derived  from  France,  and  France  before  the  Revo¬ 
lution.^  Now  the  situation  of  French  metayers  under  the  old 


*  “  Travels,”  vol.  i.,  pp.  404 — 5. 

t  Ibid.  vol.  ii.,  151 — 3. 

t  Ibid.  ii.  217. 

§  “  Principles  of  Political  Economy,” 
3d  ed.  p.  471. 

||  “  Essay  on  the  Distribution  of 
Wealth,”  pp.  102—4. 

If  M.  de  Tracy  is  partially  an  excep¬ 
tion,  inasmuch  as  his  experience  reaches 
lower  down  than  the  revolutionary 
eriod:  but  he  admits  (as  Mr.  Jones  has 
#  imself  stated  in  another  place)  that  he 
is  acquainted  only  with  a  limited  dis¬ 


trict,  of  great  subdivision  and  unfertile 
soil. 

M.  Passy  is  of  opinion,  that  a  French 
peasantry  must  be  in  indigence  and  the 
country  badly  cultivated  on  the  metayer 
system,  because  the  proportion  of  the 
roduce  claimable  by  the  landlord  is  too 
igh;  it  being  only  in  more  favorable 
climates  that  any  land,  not  of  the  most 
exuberant  fertility,  can  pay  half  its  gross 
produce  in  rent,  and  leave  enough  to 
peasant  farmers  to  enable  them  to  grow 
successfully  the  more  expensive  and  val- 


METAYERS 


295 


regime  by  no  means  represents  the  typical  form  of  the  con¬ 
tract.  It  is  essential  to  that  form,  that  the  proprietor  pays  all 
the  taxes.  But  in  France  the  exemption  of  the  noblesse  from 
direct  taxation  had  led  the  Government  to  throw  the  whole 
burden  of  their  ever-increasing  fiscal  exactions  upon  the  oc¬ 
cupiers:  and  it  is  to  these  exactions  that  Turgot  ascribed  the 
extreme  wretchedness  of  the  metayers  :  a  wretchedness  in  some 
cases  so  excessive,  that  in  Limousin  and  Angoumois  (the 
provinces  which  he  administered)  they  had  seldom  more,  ac¬ 
cording  to  him,  after  deducting  all  burdens,  than  from  twenty- 
five  to  thirty  livres  (20  to  24  shillings)  per  head  for  their  whole 
annual  consumption :  “  I  do  not  mean  in  money,  but  including 
all  that  they  consume  in  kind  from  their  own  crops.”  *  When 
we  add  that  they  had  not  the  virtual  fixity  of  tenure  of  the  me¬ 
tayers  of  Italy,  (“  in  Limousin,”  says  Arthur  , Young, f  “  the 
metayers  are  considered  as  little  better  than  menial  servants, 
removable  at  pleasure,  and  obliged  to  conform  in  all  things  to 
the  will  of  the  landlords,”)  it  is  evident  that  their  case  affords  no 
argument  against  the  metayer  system  in  its  better  form.  A 
population  who  could  call  nothing  their  own — who,  like  the 
Irish  cottiers,  could  not  in  any  contingency  be  worse  off — had 
nothing  to  restrain  them  from  multiplying,  and  subdividing 
the  land,  until  stopped  by  actual  starvation. 

We  shall  find  a  very  different  picture,  by  the  most  accurate 
authorities,  of  the  metayer  cultivation  of  Italy.  In  the  first 
place,  as  to  subdivision.  In  Lombardy,  according  to  Chateau- 
vieux,J  there  are  few  farms  which  exceed  sixty  acres,  and  few 
which  have  less  than  ten.  These  farms  are  all  occupied  by 
metayers  at  half  profit.  They  invariably  display  “  an  extent  § 
and  a  richness  in  buildings  rarely  known  in  any  other  country 
in  Europe.”  Their  plan  “  affords  the  greatest  room  with  the 
least  extent  of  building ;  is  best  adapted  to  arrange  and  secure 
the  crop ;  and  is,  at  the  same  time,  the  most  economical,  and 


uable  products  of  agriculture.  (“  On 
Systems  of  Culture,”  p.  35.)  This  is  an 
objection  only  to  a  particular  numerical 
proportion,  which  is  indeed  the  com¬ 
mon  one,  but  is  not  essential  to  the  sys¬ 
tem. 

*  See  the  “  Memoir  on  the  Surcharge 
of  Taxes  suffered  by  the  Generality  of 
Limoges,  addressed  to  the  Council  of 
State  in  1786,”  pp.  260-304  of  the  fourth 
volume  of  Turgot’s  Works.  The  occa¬ 
sional  engagements  of  landlords  (as 
mentioned  by  Arthur  Young)  to  pay  a 


part  of  the  taxes,  were,  according  to 
Turgot,  of  recent  origin,  under  the  com¬ 
pulsion  of  actual  necessity.  “  The  pro¬ 
prietor  only  consents  to  it  when  he  can 
find  no  metayer  on  other  terms;  conse¬ 
quently,  even  in  that  case,  the  metayer 
is  always  reduced  to  what  is  barely  suffi¬ 
cient  to  prevent  him  from  dying  of  hun¬ 
ger.”  (P.  275.) 

t  Vol.  i.,  p.  404. 

t  “  Letters  from  Italy,”  translated  by 
Rigby,  p.  16. 

§  Ibid.,  pp.  19,  20. 


296 


POLITICAL  ECONOMY 


the  least  exposed  to  accidents  by  fire.”  The  court-yard  “  ex¬ 
hibits  a  whole  so  regular  and  commodious,  and  a  system  of 
such  care  and  good  order,  that  our  dirty  and  ill-arranged  farms 
can  convey  no  adequate  idea  of.”  The  same  description  applies 
to  Piedmont.  The  rotation  of  crops  is  excellent.  “  I  should 
think  *  no  country  can  bring  so  large  a  portion  of  its  produce 
to  market  as  Piedmont.”  Though  the  soil  is  not  naturally  very 
fertile,  “  the  number  of  cities  is  prodigiously  great.”  The  agri¬ 
culture  must,  therefore,  be  eminently  favorable  to  the  net  as 
well  as  to  the  gross  produce  of  the  land.  “  Each  plough  works 
thirty-two  acres  in  the  season.  .  .  .  Nothing  can  be  more 

perfect  or  neater  than  the  hoeing  and  moulding  up  the  maize, 
when  in  full  growth,  by  a  single  plough,  with  a  pair  of  oxen, 
without  injury  to  a  single  plant,  while  all  the  weeds  are  effectu¬ 
ally  destroyed.”  So  much  for  agricultural  skill.  “  Nothing 
can  be  so  excellent  as  the  crop  which  precedes  and  that  which 
follows  it.”  The  wheat  “  is  thrashed  by  a  cylinder,  drawn  by 
a  horse,  and  guided  by  a  boy,  while  the  laborers  turn  over  the 
straw  with  forks.  This  process  lasts  nearly  a  fortnight:  it  is 
quick  and  economical,  and  completely  gets  out  the  grain.  .  .  , 
In  no  part  of  the  world  are  the  economy  and  the  management 
of  the  land  better  understood  than  in  Piedmont,  and  this  ex¬ 
plains  the  phenomenon  of  its  great  population  and  immense 
export  of  provisions.”  All  this  under  metayer  cultivation. 

Of  the  valley  of  the  Arno,  in  its  whole  extent,  both  above 
and  below  Florence,  the  same  writer  thus  speaks ;  f — “  Forests 
of  olive-trees  covered  the  lower  parts  of  the  mountains,  and  by 
their  foliage  concealed  an  infinite  number  of  small  farms,  which 
peopled  these  parts  of  the  mountains :  chestnut-trees  raised 
their  heads  on  the  higher  slopes,  their  healthy  verdure  con¬ 
trasting  with  the  pale  tint  of  the  olive-trees,  and  spreading  a 
brightness  over  this  amphitheatre.  The  road  was  bordered  on 
each  side  with  village-houses,  not  more  than  a  hundred  paces 
from  each  other.  .  .  .  They  are  placed  at  a  little  distance 

from  the  road,  and  separated  from  it  by  a  wall,  and  a  terrace 
of  some  feet  in  extent.  On  the  wall  are  commonly  placed  many 
vases  of  antique  forms,  in  which  flowers,  aloes,  and  young 
orange-trees  are  growing.  The  house  itself  it  completely  cov¬ 
ered  with  vines.  .  .  .  Before  these  houses  we  saw  groups  of 
peasant  females  dressed  in  white  linen,  silk  corsets,  and  straw 

*  “  Letters  from  Italy,”  pp.  24 — 31.  f  Pp*  78 — 9. 


METAYERS 


297 


hats  ornamented  with  flowers.  .  .  .  These  houses  being  so 
near  each  other,  it  is  evident  that  the  land  annexed  to  them 
must  be  small,  and  that  property,  in  these  valleys,  must  be  very 
much  divided ;  the  extent  of  these  domains  being  from  three 
to  ten  acres.  The  land  lies  round  the  houses,  and  is  divided 
into  fields  by  small  canals,  or  rows  of  trees,  some  of  which  are 
mulberry-trees,  but  the  greatest  number  poplars,  the  leaves  of 
which  are  eaten  by  the  cattle.  Each  tree  supports  a  vine.  .  .  . 
These  divisions,  arrayed  in  oblong  squares,  are  large  enough 
to  be  cultivated  by  a  plough  without  wheels,  and  a  pair  of  oxen. 
There  is  a  pair  of  oxen  between  ten  or  twelve  of  the  farmers ; 
they  employ  them  successively  in  the  cultivation  of  all  the 
farms.  .  .  .  Almost  every  farm  maintains  a  well-looking 

horse,  which  goes  in  a  small  two-wheeled  cart,  neatly  made, 
and  painted  red ;  they  serve  for  all  the  purposes  of  draught 
for  the  farm,  and  also  to  convey  the  farmer’s  daughters  to  mass 
and  to  balls.  Thus,  on  holidays,  hundreds  of  these  little  carts 
are  seen  flying  in  all  directions,  carrying  the  young  women, 
decorated  with  flowers  and  ribbons.” 

This  is  not  a  picture  of  poverty ;  and  so  far  as  agriculture  is 
concerned,  it  effectually  redeems  metayer  cultivation,  as  exist¬ 
ing  in  these  countries,  from  the  reproaches  of  English  writers ; 
but  with  respect  to  the  condition  of  the  cultivators,  Chateau- 
vieux’s  testimony  is,  in  some  points,  not  so  favorable.  “  It 
is  *  neither  the  natural  fertility  of  the  soil,  nor  the  abundance 
which  strikes  the  eye  of  the  traveller,  which  constitute  the  well¬ 
being  of  its  inhabitants.  It  is  the  number  of  individuals  among 
whom  the  total  produce  is  divided,  which  fixes  the  portion  that 
each  is  enabled  to  enjoy.  Here  it  is  very  small.  I  have  thus 
far,  indeed,  exhibited  a  delightful  country,  well  watered,  fertile, 
and  covered  with  a  perpetual  vegetation ;  I  have  shown  it  di¬ 
vided  into  countless  inclosures,  which,  like  so  many  beds  in  a 
garden,  display  a  thousand  varying  productions ;  I  have 
shown,  that  to  all  these  inclosures  are  attached  well-built 
houses,  clothed  with  vines,  and  decorated  with  flowers ;  but, 
on  entering  them,  we  find  a  total  want  of  all  the  conveniences 
of  life,  a  table  more  than  frugal,  and  a  general  appearance  of 
privation.”  Is  not  Chateauvieux  here  unconsciously  contrast¬ 
ing  the  condition  of  the  metayers  with  that  of  the  farmers  of 
other  countries,  when  the  proper  standard  with  which  to  com¬ 
pare  it  is  that  of  the  agricultural  day-laborers  ? 

*  Pp.  73—6. 


298 


POLITICAL  ECONOMY 


Arthur  Young  says,*  “  I  was  assured  that  these  metayers 
are  (especially  near  Florence)  much  at  their  ease ;  that  on  holi¬ 
days  they  are  dressed  remarkably  well,  and  not  without  ob¬ 
jects  of  luxury,  as  silver,  gold,  and  silk :  and  live  well,  on  plenty 
of  bread,  wine,  and  legumes.  In  some  instances  this  may  pos¬ 
sibly  be  the  case,  but  the  general  fact  is  contrary.  It  is  absurd 
to  think  that  metayers,  upon  such  a  farm  as  is  cultivated  by  a 
pair  of  oxen,  can  live  at  their  ease ;  and  a  clear  proof  of  their 
poverty  is  this,  that  the  landlord,  who  provides  half  the  live 
stock,  is  often  obliged  to  lend  the  peasant  money  to  procure 
his  half.  .  .  .  The  metayers,  not  in  the  vicinity  of  the  city, 
are  so  poor,  that  landlords  even  lend  them  corn  to  eat:  their 
food  is  black  bread,  made  of  a  mixture  with  vetches ;  and  their 
drink  is  very  little  wine,  mixed  with  water,  and  called  aquarolle; 
meat  on  Sundays  only;  their  dress  very  ordinary.”  Mr.  Jones 
admits  the  superior  comfort  of  the  metayers  near  Florence,  and 
attributes  it  partly  to  straw-plaiting,  by  which  the  women  of 
the  peasantry  can  earn,  according  to  Chateauvieux,f  from  fif¬ 
teen  to  twenty  pence  a  day.  But  even  this  fact  tells  in  favor  of 
the  metayer  system;  for  in  those  parts  of  England  in  which 
either  straw-plaiting  or  lace-making  is  carried  on  by  the  wom¬ 
en  and  children  of  the  laboring  class,  as  in  Bedfordshire  and 
Buckinghamshire,  the  condition  of  the  class  is  not  better,  but 
rather  worse  than  elsewhere,  the  wages  of  agricultural  labor 
being  depressed  by  a  full  equivalent. 

In  spite  of  Chateauvieux’s  statement  respecting  the  poverty 
of  the  metayers,  his  opinion,  in  respect  to  Italy  at  least,  is  given 
in  favor  of  the  system.  “  It  occupies  J  and  constantly  interests 
the  proprietors,  which  is  never  the  case  with  great  proprietors 
who  lease  their  estates  at  fixed  rents.  It  establishes  a  com¬ 
munity  of  interests,  and  relations  of  kindness  between  the  pro¬ 
prietors  and  the  metayers ;  a  kindness  which  I  have  often  wit¬ 
nessed,  and  from  which  result  great  advantages  in  the  moral 
condition  of  society.  The  proprietor,  under  this  system,  al¬ 
ways  interested  in  the  success  of  the  crop,  never  refuses  to 
make  an  advance  upon  it,  which  the  land  promises  to  repay 
with  interest.  It  is  by  these  advances,  and  by  the  hope  thus  in¬ 
spired,  that  the  rich  proprietors  of  land  have  gradually  per¬ 
fected  the  whole  rural  economy  of  Italy.  It  is  to  them  that  it 
owes  the  numerous  systems  of  irrigation  which  water  its  soil, 

*  “  Travels,”  vol.  ii.  p.  156.  t  “  Letters  from  Italy,”  p.  75.  +  Ibid.  pp.  295 — 6. 


METAYERS 


t 


299 

as  also  the  establishment  of  the  terrace  culture  on  the  hills: 
gradual  but  permanent  improvements,  which  common  peas¬ 
ants,  for  want  of  means,  could  never  have  effected,  and  which 
could  never  have  been  accomplished  by  the  farmers,  nor  by 
the  great  proprietors  who  let  their  estates  at  fixed  rents,  be¬ 
cause  they  are  not  sufficiently  interested.  Thus  the  interested 
system  forms  of  itself  that  alliance  between  the  rich  proprietor, 
whose  means  provide  for  the  improvement  of  the  culture,  and 
the  metayer,  whose  care  and  labors  are  directed,  by  a  common 
interest,  to  make  the  most  of  these  advances.” 

But  the  testimony  most  favorable  to  the  system  is  that  of  Sis- 
mondi,  which  has  the  advantage  of  being  specific,  and  from 
accurate  knowledge ;  his  information  being  not  that  of  a 
traveller,  but  that  of  a  resident  proprietor,  intimately  acquainted 
with  rural  life.  His  statements  apply  to  Tuscany  generally, 
and  more  particularly  to  the  Val  di  Nievole,  in  which  his  own 
property  lay,  and  which  is  not  within  the  supposed  privileged 
circle  immediately  round  Florence.  It  is  one  of  the  districts  in 
which  the  size  of  farms  appears  to  be  the  smallest.  The  fol¬ 
lowing  is  his  description  of  the  dwellings  and  mode  of  life  of  the 
metayers  of  that  district.* 

“  The  house,  built  of  good  walls  with  lime  and  mortar,  has 
always  at  least  one  story,  sometimes  two,  above  the  ground 
floor.  On  the  ground  floor  are  generally  the  kitchen,  a  cow¬ 
house  for  two-horned  cattle,  and  the  storehouse,  which  takes 
.  its  name,  tinaia,  from  the  large  vats  (tint)  in  which  the  wine  is 
put  to  ferment,  without  any  pressing:  it  is  there  also  that  the 
metayer  locks  up  his  casks,  his  oil,  and  his  grain.  Almost  al¬ 
ways  there  is  also  a  shed  supported  against  the  house,  where  he 
can  work  under  cover  to  mend  his  tools,  or  chop  forage  for  his 
cattle.  On  the  first  and  second  stories  are  two,  three,  and  often 
four  bedrooms.  The  largest  and  most  airy  of  these  is  generally 
destined  by  the  metayer,  in  the  months  of  May  and  June,  to  the 
bringing  up  of  silkworms.  Great  chests  to  contain  clothes  and 
linen,  and  some  wooden  chairs,  are  the  chief  furniture  of  the 
chambers ;  but  a  newly-married  wife  always  brings  with  her 
a  wardrobe  of  walnut  wood.  The  beds  are  uncurtained  and 
unroofed,  but  on  each  of  them,  besides  a  good  paillasse  filled 
with  the  elastic  straw  of  the  maize  plant,  there  are  one  or  two 
mattresses  of  wool,  or,  among  the  poorest,  of  tow,  a  good 

*  From  his  Sixth  Essay,  formerly  referred  to. 


300 


POLITICAL  ECONOMY 


blanket,  sheets  of  strong  hempen  cloth,  and  on  the  best  bed  of 
the  family  a  coverlet  of  silk  padding,  which  is  spread  on  festival 
days.  The  only  fireplace  is  in  the  kitchen ;  and  there  also  is 
the  great  wooden  table  where  the  family  dines,  and  the  benches  ; 
the  great  chest  which  serves  at  once  for  keeping  the  bread  and 
other  provisions,  and  for  kneading ;  a  tolerably  complete 
though  cheap  assortment  of  pans,  dishes,  and  earthenware 
plates :  one  or  two  metal  lamps,  a  steelyard,  and  at  least  two 
copper  pitchers  for  drawing  and  holding  water.  The  linen  and 
the  working  clothes  of  the  family  have  all  been  spun  by  the 
women  of  the  house.  The  clothes,  both  of  men  and  of  women, 
are  of  the  stuff  called  mezza  lana  when  thick,  mold  when  thin, 
and  made  of  a  coarse  thread  of  hemp  or  tow,  filled  up  with  cot¬ 
ton  or  wool ;  it  is  dried  by  the  same  women  by  whom  it  was 
spun.  It  would  hardly  be  believed  what  a  quantity  of  cloth  and 
of  mezza  lana  the  peasant  women  are  able  to  accumulate  by 
assiduous  industry ;  how  many  sheets  there  are  in  the  store ; 
what  a  number  of  shirts,  jackets,  trousers,  petticoats,  and  gowns 
are  possessed  by  every  member  of  the  family.  By  way  of 
example  I  add  in  a  note  the  inventory  of  the  peasant  family 
best  known  to  me :  it  is  neither  one  of  the  richest  nor  of  the 
poorest,  and  lives  happily  by  its  industry  on  half  the  produce  of 
less  than  ten  arpents  of  land.*  The  young  women  had  a  mar¬ 
riage  portion  of  fifty  crowns,  twenty  paid  down,  and  the  rest  by 
instalments  of  two  every  year.  The  Tuscan  crown  is  worth 
six  francs  [4s.  ioff].  The  commonest  marriage  portion  of  a 
peasant  girl  in  the  other  parts  of  Tuscany,  where  the  metairies 
are  larger,  is  100  crowns,  600  francs.” 

.Is  this  poverty,  or  consistent  with  poverty?  When  a  com¬ 
mon,  M.  de  Sismondi  even  says  the  common,  marriage  por¬ 
tion  of  a  metayer's  daughter  is  £24  English  money,  equivalent 
to  at  least  50/.  in  Italy  and  in  that  rank  of  life  ;  when  one  whose 
dowry  is  only  half  that  amount,  has  the  wardrobe  described, 
which  is  represented  by  Sismondi  as  a  fair  average ;  the  class 


*  Inventory  of  the  trousseau  of  Jane, 
daughter  of  Valente  Papini,  on  her  mar¬ 
riage  with  Giovacchino  Landi,  the  29th 
of  April,  1835,  at  Porto  Vecchia,  near 
Pescia: 

“  28  shifts,  7  best  dresses  (of  particu¬ 
lar  fabrics  of  silk),  7  dresses  of  printed 
cotton,  2  winter  working  dresses  ( mezza 
lana),  3  summer  working  dresses  and 
petticoats  {mold),  3  white  petticoats,  5 
aprons  of  printed  linen,  1  of  black  silk, 
1  of  black  merinos,  9  colored  working 


aprons  {mola),  4  white,  8  colored,  and 
3  silk,  handkerchiefs,  2  embroidered  veils 
and  one  of  tulle,  3  towels,  14  pairs  of 
stockings,  2  hats  (one  of  felt,  the  other 
of  fine  straw);  2  cameos  set  in  gold,  2 
golden  earrings,  1  chaplet  with  two 
Roman  silver  crowns,  1  coral  necklace 
with  its  cross  of  gold.  .  .  .  All  the 
richer  married  women  of  the  class  have, 
besides,  the  veste  di  seta,  the  great  holi¬ 
day  dress,  which  they  only  wear  four  or 
five  times  in  their  lives.” 


METAYERS 


3QI 


must  be  fully  comparable,  in  general  condition,  to  a  large  pro¬ 
portion  even  of  capitalist  farmers  in  other  countries ;  and  in¬ 
comparably  above  the  day-laborers  of  any  country,  except  a 
new  colony,  or  the  United  States.  Very  little  can  be  inferred, 
against  such  evidence,  from  a  traveller’s  impression  of  the 
poor  quality  of  their  food.  Its  inexpensive  character  may  be 
rather  the  effect  of  economy  than  of  necessity.  Costly  feeding 
is  not  the  favorite  luxury  of  a  southern  people ;  their  diet  in 
all  classes  is  principally  vegetable,  and  no  peasantry  on  the 
Continent  has  the  superstition  of  the  English  laborer  respect¬ 
ing  white  bread.  But  the  nourishment  of  the  Tuscan  peasants, 
according  to  Sismondi,  “  is  wholesome  and  various :  its  basis 
is  an  excellent  wheaten  bread,  brown,  but  pure  from  bran  and 
from  all  mixture.”  In  the  bad  season,  they  take  but  two  meals 
a  day :  at  ten  in  the  morning  they  eat  their  pollenta,  at  the 
beginning  of  the  night  their  soup,  and  after  it  bread  with  a 
relish  of  some  sort  ( companatico ).  In  summer  they  have  three 
meals,  at  eight,  at  one,  and  in  the  evening;  but  the  fire  is 
lighted  only  once  a  day,  for  dinner,  which  consists  of  soup, 
and  a  dish  of  salt  meat  or  dried  fish,  or  haricots,  or  greens, 
which  are  eaten  with  bread.  Salt  meat  enters  in  a  very  small 
quantity  into  this  diet,  for  it  is  reckoned  that  forty  pounds  of 
salt  pork  per  head  suffice  amply  for  a  year’s  provision ;  twice 
a  week  a  small  piece  of  it  is  put  into  the  soup.  On  Sundays  they 
have  always  on  the  table  a  dish  of  fresh  meat,  but  a  piece  which 
weighs  only  a  pound  or  a  pound  and  a  half  suffices  for  the 
whole  family,  however  numerous  it  may  be.  It  must  not  be  for¬ 
gotten  that  the  Tuscan  peasants  generally  produce  olive  oil 
for  their  own  consumption :  they  use  it  not  only  for  lamps,  but 
as  seasoning  to  all  the  vegetables  prepared  for  the  table,  which 
it  renders  both  more  savory  and  more  nutritive.  At  breakfast 
their  food  is  bread,  and  sometimes  cheese  and  fruit ;  at  supper, 
bread  and  salad.  Their  drink  is  composed  of  the  inferior  wine 
of  the  country,  the  vinellci  or  piquette  made  by  fermenting  in 
water  the  pressed  skins  of  the  grapes.  They  always,  however, 
reserve  a  little  of  their  best  wine  for  the  day  when  they  thresh 
their  corn,  and  for  some  festivals  which  are  kept  in  families. 
About  fifty  bottles  of  vinella  per  annum,  and  five  sacks  of 
wheat  (about  1,000  pounds  of  bread)  are  considered  as  the 
supply  necessary  for  a  full  grown  man.” 

The  remarks  of  Sismondi  on  the  moral  influences  of  this  state 


3°2 


POLITICAL  ECONOMY 


of  society  are  not  less  worthy  of  attention.  The  rights  and  ob¬ 
ligations  of  the  metayer  being  fixed  by  usage,  and  all  taxes  and 
rates  being  paid  by  the  proprietor,  “  the  metayer  has  the  advan¬ 
tages  of  landed  property  without  the  burden  of  defending  it.  It 
is  the  landlord  to  whom,  with  the  land,  belong  all  its  disputes : 
the  tenant  lives  in  peace  with  all  his  neighbors ;  between  him 
and  them  there  is  no  motive  for  rivalry  or  distrust,  he  preserves 
a  good  understanding  with  them,  as  well  as  with  his  landlord, 
with  the  tax  collector,  and  with  the  church :  he  sells  little,  and 
buys  little ;  he  touches  little  money,  but  he  seldom  has  any  to 
pay.  The  gentle  and  kindly  character  of  the  Tuscans  is  often 
spoken  of,  but  without  sufficiently  remarking  the  cause  which 
has  contributed  most  to  keep  up  that  gentleness ;  the  tenure, 
by  which  the  entire  class  of  farmers,  more  than  three-fourths 
of  the  population,  are  kept  free  from  almost  every  occasion  for 
quarrel.”  The  fixity  of  tenure  which  the  metayer,  so  long  as 
he  fulfils  his  own  obligations,  possesses  by  usage,  though  not 
by  law,  gives  him  the  local  attachments,  and  almost  the  strong 
sense  of  personal  interest,  characteristic  of  a  proprietor.  “  The 
metayer  lives  on  his  metairie  as  on  his  inheritance,  loving  it 
with  affection,  laboring  incessantly  to  improve  it,  confiding  in 
the  future,  and  making  sure  that  his  land  will  be  tilled  after  him 
by  his  children  and  his  children’s  children.  In  fact,  the  ma¬ 
jority  of  metayers  live  from  generation  to  generation  on  the 
same  farm ;  they  know  it  in  its  details  with  a  minuteness  which 
the  feeling  of  property  can  alone  give.  The  plots  terraced  up, 
one  above  the  other,  are  often  not  above  four  feet  wide ;  but 
there  is  not  one  of  them,  the  qualities  of  which  the  metayer 
has  not  studied.  This  one  is  dry,  that  other  is  cold  and  damp : 
here  the  soil  is  deep,  there  it  is  a  mere  crust  which  hardly  covers 
the  rock ;  wheat  thrives  best  on  one,  rye  on  another :  here  it 
would  be  labor  wasted  to  sow  Indian  corn,  elsewhere  the  soil 
is  unfit  for  beans  and  lupins,  further  off  flax  will  grow  ad¬ 
mirably,  the  edge  of  this  brook  will  be  suited  for  hemp.  In  this 
way  one  learns  with  surprise  from  the  metayer,  that  in  a  space 
of  ten  arpents,  the  soil,  the  aspect,  and  the  inclination  of  the 
ground  present  greater  variety  than  a  rich  farmer  is  generally 
able  to  distinguish  in  a  farm  of  five  hundred  acres.  For  the  lat¬ 
ter  knows  that  he  is  only  a  temporary  occupant ;  and  more¬ 
over,  that  he  must  conduct  his  operations  by  general  rules, 
and  neglect  details.  But  the  experienced  metayer  has  had  his 


METAYERS 


3°3 


intelligence  so  awakened  by  interest  and  affection,  as  to  be  the 
best  of  observers ;  and  with  the  whole  future  before  him,  he 
thinks  not  of  himself  alone,  but  of  his  children  and  grand¬ 
children.  Therefore,  when  he  plants  an  olive,  a  tree  which  lasts 
for  centuries,  and  excavates  at  the  bottom  of  the  hollow  in 
which  he  plants  it,  a  channel  to  let  out  the  water  by  which  it 
would  be  injured,  he  studies  all  the  strata  of  the  earth  which  he 
has  to  dig  out.”  * 

§  4.  I  do  not  offer  these  quotations  as  evidence  of  the  intrin¬ 
sic  excellence  of  the  metayer  system ;  but  they  surely  suffice 
to  prove  that  neither  “  land  miserably  cultivated  ”  nor  a  peo¬ 
ple  in  “  the  most  abject  poverty,”  have  any  necessary  con¬ 
nection  with  it,  and  that  the  unmeasured  vituperation  lavished 
upon  the  system  by  English  writers,  is  grounded  on  an  ex¬ 
tremely  narrow  view  of  the  subject.  I  look  upon  the  real  econ¬ 
omy  of  Italy  as  simply  so  much  additional  evidence  in  favor  of 
small  occupations  with  permanent  tenure.  It  is  an  example  of 
what  can  be  accomplished  by  those  two  elements,  even  under 
the  disadvantage  of  the  peculiar  nature  of  the  metayer  con¬ 
tract,  in  which  the  motives  to  exertion  on  the  part  of  the  tenant 
are  only  half  as  strong  as  if  he  farmed  the  land  on  the  same 
footing  of  perpetuity  at  a  money-rent,  either  fixed,  or  varying 
according  to  some  rule  which  would  leave  to  the  tenant  the 
whole  benefit  of  his  own  exertions.  The  metayer  tenure  is 
not  one  which  we  should  be  anxious  to  introduce  where  the 
exigencies  of  society  had  not  naturally  given  birth  to  it;  but 
neither  ought  we  to  be  eager  to  abolish  it  on  a  mere  a  priori 
view  of  its  disadvantages.  If  the  system  in  Tuscany  works  as 
well  in  practice  as  it  is  represented  to  do,  with  every  appearance 
of  minute  knowledge,  by  so  competent  an  authority  as  Sis- 
mondi ;  if  the  mode  of  living  of  the  people,  and  the  size  of 


*  Of  the  intelligence  of  this  interest¬ 
ing  people,  M.  de  Sismondi  speaks  in 
the  most  favorable  terms.  Few  of  them 
can  read;  but  there  is  often  one  member 
of  the  family  destined  for  the  priesthood, 
who  reads  to  them  on  winter  evenings. 
Their  language  differs  little  from  the 
purest  Italian.  The  taste  for  improvisa¬ 
tion  in  verse  is  general.  “  The  peasants 
of  the  Vale  of  Nievole  frequent  the  thea¬ 
tre  in  summer  on  festival  days,  from 
nine  to  eleven  at  night:  their  admission 
costs  them  little  more  than  five  French 
sous  (2*4 d).  Their  favorite  author,  is 
Alfieri;  the  whole  history  of  the  Atridae 
is  familiar  to  these  people  who  cannot 
read,  and  who  seek  from  that  austere 


poet  a  relaxation  from  their  rude  la¬ 
bors.”  Unlike  most  rustics,  they  find 
pleasure  in  the  beauty  of  their  country. 
“  In  the  hills  of  the  vale  of  Nievole 
there  is  in  front  of  every  house  a  thresh¬ 
ing-ground,  seldom  of  more  than  25  or 
30  square  fathoms;  it  is  often  the  only 
level  space  in  the  whole  farm:  it  is  at 
the  same  time  a  terrace  which  commands 
the  plains  and  the  valley,  and  looks  out 
upon  a  delightful  country.  Scarcely  ever 
have  I  stood  still  to  admire  it,  without 
the  metayer's  coming  out  to  enjoy  my 
admiration,  and  point  out  with  his  finger 
the  beauties  which  he  thought  might 
have  escaped  my  notice.” 


3°4 


POLITICAL  ECONOMY 


farms,  have  for  ages  maintained  and  still  maintain  themselves  * 
such  as  they  are  said  to  be  by  him,  it  were  to  be  regretted  that 
a  state  of  rural  well-being  so  much  beyond  what  is  realized 
in  most  European  countries,  should  be  put  to  hazard  by  an 
attempt  to  introduce,  under  the  guise  of  agricultural  improve¬ 
ment,  a  system  of  money-rents  and  capitalist  farmers.  Even 
where  the  metayers  are  poor,  and  the  subdivision  great,  it  is 
not  to  be  assumed  as  of  course,  that  the  change  would  be  for 
the  better.  The  enlargement  of  farms,  and  the  introduction 
of  what  are  called  agricultural  improvements,  usually  dimin¬ 
ish  the  number  of  laborers  employed  on  the  land ;  and  unless 
the  growth  of  capital  in  trade  and  manufactures  affords  an 
opening  for  the  displaced  population,  or  unless  there  are  re- 
claimable  wastes  on  which  they  can  be  located,  competition 
will  so  reduce  wages,  that  they  will  probably  be  worse  off  as 
day-laborers  than  they  were  as  metayers. 

Mr.  Jones  very  properly  objects  against  the  French  econo¬ 
mists  of  the  last  century,  that  in  pursuing  their  favorite  object 
of  introducing  money-rents,  they  turned  their  minds  solely 
to  putting  farmers  in  the  place  of  metayers,  instead  of  trans¬ 
forming  the  existing  metayers  into  farmers ;  which,  as  he  justly 
remarks,  can  scarcely  be  effected,  unless,  to  enable  the  me¬ 
tayers  to  save  and  become  owners  of  stock,  the  proprietors 
submit  for  a  considerable  time  to  a  diminution  of  income,  in¬ 
stead  of  expecting  an  increase  of  it,  which  has  generally  been 
their  immediate  motive  for  making  the  attempt.  If  this  trans¬ 
formation  were  effected,  and  no  other  change  made  in  the  me¬ 
tayer’s  condition;  if,  preserving  all  the  other  rights  which 
usage  insures  to  him,  he  merely  got  rid  of  the  landlord’s  claim 
to  half  the  produce,  paying  in  lieu  of  it  a  moderate  fixed  rent ; 
he  would  be  so  far  in  a  better  position  than  at  present,  as  the 
whole,  instead  of  only  half  the  fruits  of  any  improvement  he 
made,  would  now  belong  to  himself ;  but  even  so,  the  benefit 
would  not  be  without  alloy ;  for  a  metayer,  though  not  him¬ 
self  a  capitalist,  has  a  capitalist  for  his  partner,  and  has  the 
use,  in  Italy  at  least,  of  a  considerable  capital,  as  is  proved  by 


*  “  We  never,”  says  Sismondi,  “  find  a 
family  of  metayers  proposing  to  their 
landlord  to  divide  the  metairie,  unless 
the  work  is  really  more  than  they  can 
do,  and  they  feel  assured  of  retaining 
the  same  enjoyments  on  a  smaller  piece 
of  ground.  We  never  find  several  sons 
all  marrying,  and  forming  as  many  new 


families:  only  one  marries  and  under¬ 
takes  the  charge  of  the  household:  none 
of  the  others  marry  unless  the  first  is 
childless,  or  unless  some  one  of  them 
has  the  offer  of  a  new  metairie.”  “  New 
Principles  of  Political  Economy,”  book 
iii.  chap.  5. 


COTTIERS 


305 


the  excellence  of  the  farm  buildings :  and  it  is  not  probable 
that  the  landowners  would  any  longer  consent  to  peril  their 
movable  property  on  the  hazards  of  agricultural  enterprise, 
when  assured  of  a  fixed  money  income  without  it.  Thus  would 
the  question  stand,  even  if  the  change  left  undisturbed  the  me¬ 
tayer’s  virtual  fixity  of  tenure,  and  converted  him,  in  fact,  into 
a  peasant  proprietor  at  a  quit  rent.  But  if  we  suppose  him 
converted  into  a  mere  tenant,  displaceable  at  the  landlord's 
will,  and  liable  to  have  his  rent  raised  by  competition  to  any 
amount  which  any  unfortunate  being  in  search  of  subsistence 
can  be  found  to  offer  or  promise  for  it,  he  would  lose  all  the 
features  in  his  condition  which  preserve  it  from  being  de¬ 
teriorated:  he  would  be  cast  down  from  his  present  position 
of  a  kind  of  half  proprietor  of  the  land,  and  would  sink  into 
a  cottier  tenant. 


Chapter  IX. — Of  Cottiers 

§  1.  By  the  general  appellation  of  cottier  tenure,  I  shall  desig¬ 
nate  all  cases  without  exception,  in  which  the  laborer  makes 
his  contract  for  land  without  the  intervention  of  a  capitalist 
farmer,  and  in  which  the  conditions  of  the  contract,  especially 
the  amount  of  rent,  are  determined  not  by  custom  but  by  com¬ 
petition.  The  principal  European  example  of  this  tenure  is 
Ireland,  and  it  is  from  that  country  that  the  term  cottier  is 
derived.*  By  far  the  greater  part  of  the  agricultural  popula¬ 
tion  of  Ireland  might  until  very  lately  have  been  said  to  be 
cottier-tenants ;  except  so  far  as  the  Ulster  tenant-right  con¬ 
stituted  an  exception.  There  was,  indeed,  a  numerous  class 
of  laborers  who  (we  may  presume  through  the  refusal  either 
of  proprietors  or  of  tenants  in  possession  to  permit  any  further 
subdivision)  had  been  unable  to  obtain  even  the  smallest  patch 
of  land  as  permanent  tenants.  But,  from  the  deficiency  of  cap¬ 
ital,  the  custom  of  paying  wages  in  land  was  so  universal,  that 
even  those  who  worked  as  casual  laborers  for  the  cottiers  or  for 
such  larger  farmers  as  were  found  in  the  country,  were  usually 
paid  not  in  money,  but  by  permission  to  cultivate  for  the  season 
a  piece  of  ground,  which  was  generally  delivered  to  them  by 

*  In  its  original  acceptation,  the  word  stretched  the  term  to  include  those 
"  cottier  ”  designated  a  class  of  sub-  small  farmers  themselves,  and  generally 
tenants,  who  rent  a  cottage  and  an  acre  all  peasant  farmers  whose  rents  are  de- 
or  two  of  land  from  the  small  farmers.  termined  by  competition. 

But  the  usage  of  writers  has  long  since 

VOL.  I. — 20 


3°6 


POLITICAL  ECONOMY 


the  farmer  ready  manured,  and  was  known  by  the  name  of 
conacre.  For  this  they  agreed  to  pay  a  money  rent,  often  of 
several  pounds  an  acre,  but  no  money  actually  passed,  the  debt 
being  worked  out  in  labor,  at  a  money  valuation. 

The  produce,  on  the  cottier  system,  being  divided  into  two 
portions,  rent,  and  the  remuneration  of  the  laborer;  the  one 
is  evidently  determined  by  the  other.  The  laborer  has  whatever 
the  landlord  does  not  take:  the  condition  of  the  laborer  de¬ 
pends  on  the  amount  of  rent.  But  rent,  being  regulated  by 
competition,  depends  upon  the  relation  between  the  demand  for 
land,  and  the  supply  of  it.  The  demand  for  land  depends 
on  the  number  of  competitors,  and  the  competitors  are  the 
whole  rural  population.  The  effect,  therefore,  of  this  tenure, 
is  to  bring  the  principle  of  population  to  act  directly  on  the 
land,  and  not,  as  in  England,  on  capital.  Rent,  in  this  state  of 
things,  depends  on  the  proportion  between  population  and  land. 
As  the  land  is  a  fixed  quantity,  while  population  has  an  un¬ 
limited  power  of  increase,  unless  something  checks  that  in¬ 
crease,  the  competition  for  land  soon  forces  up  rent  to  the 
highest  point  consistent  with  keeping  the  population  alive.  The 
effects,  therefore,  of  cottier  tenure  depend  on  the  extent  to 
which  the  capacity  of  population  to  increase  is  controlled,  either 
by  custom,  by  individual  prudence,  or  by  starvation  and  disease. 

It  would  be  an  exaggeration  to  affirm,  that  cottier  tenancy  is 
absolutely  incompatible  with  a  prosperous  condition  of  the  la¬ 
boring  class.  If  we  could  suppose  it  to  exist  among  a  people 
to  whom  a  high  standard  of  comfort  was  habitual ;  whose  re¬ 
quirements  were  such,  that  they  would  not  offer  a  higher  rent 
for  land  than  would  leave  them  an  ample  subsistence,  and  whose 
moderate  increase  of  numbers  left  no  unemployed  population 
to  force  up  rents  by  competition,  save  when  the  increasing  prod¬ 
uce  of  the  land  from  increase  of  skill  would  enable  a  higher 
rent  to  be  paid  without  inconvenience ;  the  cultivating  class 
might  be  as  well  remunerated,  might  have  as  large  a  share  of 
the  necessaries  and  comforts  of  life,  on  this  system  of  tenure 
as  on  any  other.  They  would  not,  however,  while  their  rents 
were  arbitrary,  enjoy  any  *of  the  peculiar  advantages  which 
metayers  on  the  Tuscan  system  derive  from  their  connection 
with  the  land.  They  would  neither  have  the  use  of  a  capital 
belonging  to  their  landlords,  nor  would  the  want  of  this  be 
made  up  by  the  intense  motives  to  bodily  and  mental  exertion, 


COTTIERS 


3°7 


which  act  upon  the  peasant  who  has  a  permanent  tenure.  On 
the  contrary,  any  increased  value  given  to  the  land  by  the  ex¬ 
ertions  of  the  tenant,  would  have  no  effect  but  to  raise  the  rent 
against  himself,  either  the  next  year,  or  at  farthest  when  his 
lease  expired.  The  landlords  might  have  justice  or  good  sense 
enough  not  to  avail  themselves  of  the  advantage  which  compe¬ 
tition  would  give  them ;  and  different  landlords  would  do  so 
in  different  degrees.  But  it  is  never  safe  to  expect  that  a  class 
or  body  of  men  will  act  in  opposition  to  their  immediate  pecun¬ 
iary  interest;  and  even  a  doubt  on  the  subject  would  be  almost 
as  fatal  as  a  certainty,  for  when  a  person  is  considering  whether 
or  not  to  undergo  a  present  exertion  or  sacrifice  for  a  compara¬ 
tively  remote  future,  the  scale  is  turned  by  a  very  small  proba¬ 
bility  that  the  fruits  of  the  exertion  or  of  the  sacrifice  would  be 
taken  from  him.  The  only  safeguard  against  these  uncertain¬ 
ties  would  be  the  growth  of  a  custom,  insuring  a  permanence 
of  tenure  in  the  same  occupant,  without  liability  to  any  other 
increase  of  rent  than  might  happen  to  be  sanctioned  by  the 
general  sentiments  of  the  community.  The  Ulster  tenant-right 
is  such  a  custom.  The  very  considerable  sums  which  outgoing 
tenants  obtain  from  their  successors,  for  the  good-will  of  their 
farms,*  in  the  first  place  actually  limit  the  competition  for  land 
to  persons  who  have  such  sums  to  offer:  while  the  same  fact 
also  proves  that  full  advantage  is  not  taken  by  the  landlord 
of  even  that  more  limited  competition,  since  the  landlord’s  rent 
does  not  amount  to  the  whole  of  what  the  incoming  tenant  not 
only  offers  but  actually  pays.  He  does  so  in  the  full  confidence 
that  the  rent  will  not  be  raised ;  and  for  this  he  has  the  guar¬ 
antee  of  a  custom,  not  recognized  by  law,  but  deriving  its  bind¬ 
ing  force  from  another  sanction,  perfectly  well  understood  in 
Ireland. f  Without  one  or  other  of  these  supports,  a  custom 
limiting  the  rent  of  land  is  not  likely  to  grow  up  in  any  progres- 


*  “  It  is  not  uncommon  for  a  tenant 
without  a  lease  to  sell  the  bare  privilege 
of  occupancy  or  possession  of  his  farm, 
without  any  visible  sign  of  improve¬ 
ment  haying  been  made  by  him,  at  from 
ten  to  sixteen,  up  to  twenty  and  even 
forty  years’  purchase  of  the  rent.” — 
(“  Digest  of  Evidence  Taken  by  Lord 
Devon’s  Commission,”  Introductory 
Chapter.)  The  compiler  adds,  “  the 
comparative  tranquillity  of  that  district  ” 
(Ulster)  “  may  perhaps  be  mainly  at¬ 
tributable  to  this  fact.” 

t  “  It  is  in  the  great  majority  of  cases 
not  a  reimbursement  for  outlay  incurred, 


or  improvements  effected  on  the  land, 
but  a  mere  life  insurance  or  purchase  of 
immunity  from  outrage.” — (“  Digest,  ut 
supra.”)  “  The  present  tenant-right  of 
Ulster  ”  (the  writer  judiciously  remarks) 
**  is  an  embryo  copyhold.”  “  Even  there, 
if  the  tenant-right  be  disregarded,  and 
a  tenant  be  ejected  without  having  re¬ 
ceived  the  price  of  his  good-will,  out¬ 
rages  are  generally  the  consequence.”— 
(Chapter  viii.)  “  The  disorganized  state 
of  Tipperary,  and  the  agrarian  combina¬ 
tion  throughout  Ireland,  are  but  a 
methodized  war  to  obtain  the  Ulster 
tenant-right.” 


3°8 


POLITICAL  ECONOMY 


sive  community.  If  wealth  and  population  were  stationary, 
rent  also  would  generally  be  stationary,  and  after  remaining 
a  long  time  unaltered,  would  probably  come  to  be  considered 
unalterable.  But  all  progress  in  wealth  and  population  tends 
to  a  rise  of  rents.  Under  a  metayer  system  there  is  an  estab¬ 
lished  mode  in  which  the  owner  of  land  is  sure  of  participating 
in  the  increased  produce  drawn  from  it.  But  on  the  cottier 
system  he  can  only  do  so  by  a  readjustment  of  the  contract, 
while  that  readjustment,  in  a  progressive  community,  would 
almost  always  be  to  his  advantage.  His  interest,  therefore, 
is  decidedly  opposed  to  the  growth  of  any  custom  commuting 
rent  into  a  fixed  demand. 

§  2.  Where  the  amount  of  rent  is  not  limited,  either  by  law 
or  custom,  a  cottier  system  has  the  disadvantages  of  the  worst 
metayer  system,  with  scarcely  any  of  the  advantages  by  which, 
in  the  best  forms  of  that  tenure,  they  are  compensated.  It  is 
scarcely  possible  that  cottier  agriculture  should  be  other  than 
miserable.  There  is  not  the  same  necessity  that  the  condition 
of  the  cultivators  should  be  so.  Since  by  a  sufficient  restraint 
on  population  competition  for  land  could  be  kept  down,  and 
extreme  poverty  prevented ;  habits  of  prudence  and  a  high 
standard  of  comfort,  once  established,  would  have  a  fair  chance 
of  maintaining  themselves:  though  even  in  these  favorable 
circumstances  the  motives  to  prudence  would  be  considerably 
weaker  than  in  the  case  of  metayers,  protected  by  custom  (like 
those  of  Tuscany)  from  being  deprived  of  their  farms:  since 
a  metayer  family,  thus  protected,  could  not  be  impoverished  by 
any  other  improvident  multiplication  than  their  own,  but  a 
cottier  family,  however  prudent  and  self-restraining,  may  have 
the  rent  raised  against  it  by  the  consequences  of  the  multiplica¬ 
tion  of  other  families.  Any  protection  to  the  cottiers  against 
this  evil  could  only  be  derived  from  a  salutary  sentiment  of 
duty  or  dignity,  pervading  the  class.  From  this  source,  how¬ 
ever,  they  might  derive  considerable  protection.  If  the  habitual 
standard  of  requirement  among  the  class  were  high,  a  young 
man  might  not  choose  to  offer  a  rent  which  would  leave  him 
in  a  worse  condition  than  the  preceding  tenant;  or  it  might 
be  the  general  custom,  as  it  actually  is  in  some  countries,  not 
to  marry  until  a  farm  is  vacant. 

But  it  is  not  where  a  high  standard  of  comfort  has  rooted 
itself  in  the  habits  of  the  laboring  classes,  that  we  are  ever 


COTTIERS 


309 


called  upon  to  consider  the  effects  of  a  cottier  system.  That 
system  is  found  only  where  the  habitual  requirements  of  the 
rural  laborers  are  the  lowest  possible;  where,  as  long  as  they 
are  not  actually  starving,  they  will  multiply:  and  population 
is  only  checked  by  the  diseases,  and  the  shortness  of  life,  con¬ 
sequent  on  insufficiency  of  merely  physical  necessaries.  This 
was  the  state  of  the  largest  portion  of  the  Irish  peasantry. 
When  a  people  have  sunk  into  this  state,  and  still  more  when 
they  have  been  in  it  from  time  immemorial,  the  cottier  system 
is  an  almost  insuperable  obstacle  to  their  emerging  from  it. 
When  the  habits  of  the  people  are  such  that  their  increase  is 
never  checked  but  by  the  impossibility  of  obtaining  a  bare  sup¬ 
port,  and  when  this  support  can  only  be  obtained  from  *land,  all 
stipulations  and  agreements  respecting  amount  of  rent  are 
merely  nominal ;  the  competition  for  land  makes  the  tenants 
undertake  to  pay  more  than  it  is  possible  they  should  pay,  and 
when  they  have  paid  all  they  can,  more  almost  always  remains 
due. 

“  As  it  may  fairly  be  said  of  the  Irish  peasantry,”  said  Mr. 
Revans,  the  Secretary  to  the  Irish  Poor  Law  Inquiry  Commis¬ 
sion,*  “  that  every  family  which  has  not  sufficient  land  to  yield 
its  food  has  one  or  more  of  its  members  supported  by  begging, 
it  will  easily  be  conceived  that  every  endeavor  is  made  by  the 
peasantry  to  obtain  small  holdings,  and  that  they  are  not  influ¬ 
enced  in  their  biddings  by  the  fertility  of  the  land,  or  by  their 
ability  to  pay  the  rent,  but  solely  by  the  offer  which  is  most 
likely  to  gain  them  possession.  The  rents  which  they  promise, 
they  are  almost  invariably  incapable  of  paying;  and  conse¬ 
quently  they  become  indebted  to  those  under  whom  they  hold, 
almost  as  soon  as  they  take  possession.  They  give  up,  in  the 
shape  of  rent,  the  whole  produce  of  the  land  with  the  exception 
of  a  sufficiency  of  potatoes  for  a  subsistence ;  but  as  this  is 
rarely  equal  to  the  promised  rent,  they  constantly  have  against 
them  an  increasing  balance.  In  some  cases,  the  largest  quan¬ 
tity  of  produce  which  their  holdings  ever  yielded  or  which, 
under  their  system  of  tillage,  they  could  in  the  most  favorable 
seasons  be  made  to  yield,  would  not  be  equal  to  the  rent  bid ; 
consequently,  if  the  peasant  fulfilled  his  engagement  with  his 

*  “  Evils  of  the  State  of  Ireland,  their  tion  of  evidence  from  the  mass  collected 
Causes  and  their  Remedy.”  Page  to.  by  the  Commission  presided  over  by 
A  pamphlet,  containing,  among  other  Archbishop  Whatcly. 
things,  an  excellent  digest  and  selec- 


3IQ 


POLITICAL  ECONOMY 


landlord,  which  he  is  rarely  able  to  accomplish,  he  would  till 
the  ground  for  nothing,  and  give  his  landlord  a  premium  for 
being  allowed  to  till  it.  On  the  seacoast,  fishermen,  and  in  the 
northern  counties  those  who  have  looms,  frequently  pay  more 
in  rent  than  the  market  value  of  the  whole  produce  of  the  land 
they  hold.  It  might  be  supposed  that  they  would  be  better  with¬ 
out  land  under  such  circumstances.  But  fishing  might  fail  dur¬ 
ing  a  week  or  two,  and  so  might  the  demand  for  the  produce 
of  the  loom,  when,  did  they  not  possess  the  land  upon  which 
their  food  is  grown,  they  might  starve.  The  full  amount  of  the 
rent  bid,  however,  is  rarely  paid.  The  peasant  remains  con¬ 
stantly  in  debt  to  his  landlord;  his  miserable  possessions — 
the  wretched  clothing  of  himself  and  of  his  family,  the  two 
or  three  stools,  and  the  few  pieces  of  crockery,  which  his 
wretched  hovel  contains,  would  not,  if  sold,  liquidate  the  stand¬ 
ing  and  generally  accumulating  debt.  The  peasantry  are  mostly 
a  year  in  arrear,  and  their  excuse  for  not  paying  more  is  desti¬ 
tution.  Should  the  produce  of  the  holding,  in  any  year,  be 
more  than  usually  abundant,  or  should  the  peasant  by  any  acci¬ 
dent  become  possessed  of  any  property,  his  comforts  cannot  be 
increased ;  he  cannot  indulge  in  better  food,  nor  in  a  greater 
quantity  of  it.  His  furniture  cannot  be  increased,  neither  can 
his  wife  or  children  be  better  clothed.  The  acquisition  must 
go  to  the  person  under  whom  he  holds.  The  accidental  addi¬ 
tion  will  enable  him  to  reduce  his  arrear  of  rent,  and  thus  to 
defer  ejectment.  But  this  must  be  the  bound  of  his  expec¬ 
tation.” 

As  an  extreme  instance  of  the  intensity  of  competition  for 
land,  and  of  the  monstrous  height  to  which  it  occasionally  forced 
up  the  nominal  rent,  we  may  cite  from  the  evidence  taken 
by  Lord  Devon’s  Commission,*  a  fact  attested  by  Mr.  Hurly, 
Clerk  of  the  Crown  for  Kerry :  “  I  have  known  a  tenant  bid 
for  a  farm  that  I  was  perfectly  well  acquainted  with,  worth 
£50  a  year:  I  saw  the  competition  get  up  to  such  an  extent, 
that  he  was  declared  the  tenant  at  £450.” 

§  3.  In  such  a  condition,  what  can  a  tenant  gain  by  any 
amount  of  industry  or  prudence,  and  what  lose  by  any  reck¬ 
lessness?  If  the  landlord  at  any  time  exerted  his  full  legal 
rights,  the  cottier  would  not  be  able  even  to  live.  If  by  extra 
exertion  he  doubled  the  produce  of  his  bit  of  land,  or  if  he 


*  “  Evidence,”  p.  851. 


COTTIERS 


3ii 

prudently  abstained  from  producing  mouths  to  eat  it  up,  his 
only  gain  would  be  to  have  more  left  to  pay  to  his  landlord ; 
while,  if  he  had  twenty  children,  they  would  still  be  fed  first, 
and  the  landlord  could  only  take  what  was  left.  Almost  alone 
among  mankind  the  cottier  is  in  this  condition,  that  he  can 
scarcely  be  either  better  or  worse  off  by  any  act  of  his  own. 
If  he  were  industrious  or  prudent,  nobody  but  his  landlord 
would  gain ;  if  he  is  lazy  or  intemperate,  it  is  at  his  landlord’s 
expense.  A  situation  more  devoid  of  motives  to  either  labor 
or  self-command,  imagination  itself  cannot  conceive.  The  in¬ 
ducements  of  free  human  beings  are  taken  away,  and  those  of 
a  slave  not  substituted.  He  has  nothing  to  hope,  and  nothing 
to  fear,  except  being  dispossessed  of  his  holding,  and  against 
this  he  protects  himself  by  the  ultima  ratio  of  a  defensive  civil 
war.  Rockism  and  Whiteboyism  were  the  determination  of 
a  people  who  had  nothing  that  could  be  called  theirs  but  a  daily 
meal  of  the  lowest  description  of  food,  not  to  submit  to  being 
deprived  of  that  for  other  people’s  convenience. 

Is  it  not,  then,  a  bitter  satire  on  the  mode  in  which  opinions 
are  formed  on  the  most  important  problems  of  human  nature 
and  life,  to  find  public  instructors  of  the  greatest  pretension, 
imputing  the  backwardness  of  Irish  industry,  and  the  want 
of  energy  of  the  Irish  people  in  improving  their  condition,  to 
a  peculiar  indolence  and  recklessness  in  the  Celtic  race?  Of 
all  vulgar  modes  of  escaping  from  the  consideration  of  the 
effect  of  social  and  moral  influences  on  the  human  mind,  the 
most  vulgar  is  that  of  attributing  the  diversities  of  conduct 
and  character  to  inherent  natural  differences.  What  race  would 
not  be  indolent  and  insouciant  when  things  are  so  arranged,  that 
they  derive  no  advantage  from  forethought  or  exertion?  If 
such  are  the  arrangements  in  the  midst  of  which  they  live  and 
work,  what  wonder  if  the  listlessness  and  indifference  so  en¬ 
gendered  are  not  shaken  off  the  first  moment  an  opportunity 
offers  when  exertion  would  really  be  of  use  ?  It  is  very  natural 
that  a  pleasure-loving  and  sensitively  organized  people  like  the 
Irish,  should  be  less  addicted  to  steady  routine  labor  than  the 
English,  because  life  has  more  excitements  for  them  independ¬ 
ent  of  it ;  but  they  are  not  less  fitted  for  it  than  their  Celtic 
brethren  the  French,  nor  less  so  than  the  Tuscans,  or  the  an¬ 
cient  Greeks.  An  excitable  organization  is  precisely  that  in 
which,  by  adequate  inducements,  it  is  easiest  to  kindle  a  spirit 


312 


POLITICAL  ECONOMY 


of  animated  exertion.  It  speaks  nothing  against  the  capacities 
of  industry  in  human  beings,  that  they  will  not  exert  themselves 
without  motive.  No  laborers  work  harder,  in  England  or 
America,  than  the  Irish ;  but  not  under  a  cottier  system. 

§  4.  The  multitudes  who  till  the  soil  of  India,  are  in  a  con¬ 
dition  sufficiently  analogous  to  the  cottier  system,  and  at  the 
same  time  sufficiently  different  from  it,  to  render  the  compari¬ 
son  of  the  two  a  source  of  some  instruction.  In  most  parts 
of  India  there  are,  and  perhaps  have  always  been,  only  two 
contracting  parties,  the  landlord  and  the  peasant :  the  landlord 
being  generally  the  sovereign,  except  where  he  has,  by  a  special 
instrument,  conceded  his  rights  to  an  individual,  who  becomes 
his  representative.  The  payments,  however,  of  the  peasants, 
or  ryots,  as  they  are  termed,  have  seldom  if  ever  been  regulated, 
as  in  Ireland,  by  competition.  Though  the  customs  locally 
obtaining  were  infinitely  various,  and  though  practically  no 
custom  could  be  maintained  against  the  sovereign’s  will,  there 
was  always  a  rule  of  some  sort  common  to  a  neighborhood: 
the  collector  did  not  make  his  separate  bargain  with  the  peas¬ 
ant,  but  assessed  each  according  to  the  rule  adopted  for  the  rest. 
The  idea  was  thus  kept  up  of  a  right  of  property  in  the  tenant, 
or  at  all  events,  of  a  right  to  permanent  possession;  and  the 
anomaly  arose  of  a  fixity  of  tenure  in  the  peasant-farmer,  co¬ 
existing  with  an  arbitrary  power  of  increasing  the  rent. 

When  the  Mogul  government  substituted  itself  throughout 
the  greater  part  of  India  for  the  Hindoo  rulers,  it  proceeded 
on  a  different  principle.  A  minute  survey  was  made  of  the  land, 
and  upon  that  survey  an  assessment  was  founded,  fixing  the 
specific  payment  due  to  the  government  from  each  field.  If 
this  assessment  had  never  been  exceeded,  the  ryots  would  have 
been  in  the  comparatively  advantageous  position  of  peasant- 
proprietors,  subject  to  a  heavy,  but  a  fixed  quit-rent.  The  ab¬ 
sence,  however,  of  any  real  protection  against  illegal  extortions, 
rendered  this  improvement  in  their  condition  rather  nominal 
than  real ;  and,  except  during  the  occasional  accident  of  a 
humane  and  vigorous  local  administrator,  the  exactions  had  no 
practical  limit  but  the  inability  of  the  ryot  to  pay  more. 

It  was  to  this  state  of  things  that  the  English  rulers  of  India 
succeeded ;  and  they  were,  at  an  early  period,  struck  with  the 
importance  of  putting  an  end  to  this  arbitrary  character  of 
the  land-revenue,  and  imposing  a  fixed  limit  to  the  government 


COTTIERS 


3i3 


demand.  They  did  not  attempt  to  go  back  to  the  Mogul  valua¬ 
tion.  It  has  been  in  general  the  very  rational  practice  of  the 
English  Government  in  India,  to  pay  little  regard  to  what  was 
laid  down  as  the  theory  of  the  native  institutions,  but  to  inquire 
into  the  rights  which  existed  and  were  respected  in  practice,  and 
to  protect  and  enlarge  those.  For  a  long  time,  however,  it  blun¬ 
dered  grievously  about  matters  of  fact,  and  grossly  misunder¬ 
stood  the  usages  and  rights  which  it  found  existing.  Its  mis¬ 
takes  arose  from  the  inability  of  ordinary  minds  to  imagine  a 
state  of  social  relations  fundamentally  different  from  those  with 
which  they  are  practically  familiar.  England  being  accustomed 
to  great  estates  and  great  landlords,  the  English  rulers  took  it 
for  granted  that  India  must  possess  the  like ;  and  looking  round 
for  some  set  of  people  who  might  be  taken  for  the  objects  of 
their  search,  they  pitched  upon  a  sort  of  tax-gatherers  called 
zemindars.  “  The  zemindar,”  says  the  philosophical  historian 
of  India,*  “  had  some  of  the  attributes  which  belong  to  a  land- 
owner;  he  collected  the  rents  of  a  particular  district,  he  gov¬ 
erned  the  cultivators  of  that  district,  lived  in  comparative  splen¬ 
dor,  and  his  son  succeeded  him  when  he  died.  The  zemindars, 
therefore,  it  was  inferred  without  delay,  were  the  proprietors 
of  the  soil,  the  landed  nobility  and  gentry  of  India.  It  was  not 
considered  that  the  zemindars,  though  they  collected  the  rents, 
did  not  keep  them ;  but  paid  them  all  away,  with  a  small  de¬ 
duction,  to  the  government.  It  was  not  considered  that  if  they 
governed  the  ryots,  and  in  many  respects  exercised  over  them 
despotic  power,  they  did  not  govern  them  as  tenants  of  theirs, 
holding  their  lands  either  at  will  or  by  contract  under  them. 
The  possession  of  the  ryot  was  an  hereditary  possession ;  from 
which  it  was  unlawful  for  the  zemindar  to  displace  him:  for 
every  farthing  which  the  zemindar  drew  from  the  ryot,  he  was 
bound  to  account ;  and  it  was  only  by  fraud,  if,  out  of  all  that 
he  collected,  he  retained  an  ana  more  than  the  small  proportion 
which,  as  pay  for  the  collection,  he  was  permitted  to  receive.” 

“  There  was  an  opportunity  in  India,”  continues  the  histo¬ 
rian,  “  to  which  the  history  of  the  world  presents  not  a  parallel. 
Next  after  the  sovereign,  the  immediate  cultivators  had,  by 
far,  the  greatest  portion  of  interest  in  the  soil.  For  the  rights 
(such  as  they  were)  of  the  zemindars,  a  complete  compensation 
might  have  easily  been  made.  The  generous  resolution  was 

*  “  Mill’s  History  of  British  India,”  book  vi.  chap.  8. 


Z14 


POLITICAL  ECONOMY 


adopted,  of  sacrificing  to  the  improvement  of  the  country,  the 
proprietary  rights  of  the  sovereign.  The  motives  to  improve¬ 
ment  which  property  gives,  and  of  which  the  power  was  so 
justly  appreciated,  might  have  been  bestowed  upon  those  upon 
whom  they  would  have  operated  with  a  force  incomparably 
greater  than  that  with  which  they  could  operate  upon  any  other 
class  of  men :  they  might  have  been  bestowed  upon  those  from 
whom  alone,  in  every  country,  the  principal  improvements  in 
agriculture  must  be  derived,  the  immediate  cultivators  of  the 
soil.  And  a  measure  worthy  to  be  ranked  among  the  noblest 
that  ever  were  taken  for  the  improvement  of  any  country,  might 
have  helped  to  compensate  the  people  of  India  for  the  miseries 
of  that  misgovernment  which  they  had  so  long  endured.  But 
the  legislators  were  English  aristocrats ;  and  aristocratical  prej¬ 
udices  prevailed/' 

The  measure  proved  a  total  failure,  as  to  the  main  effects 
which  its  well-meaning  promoters  expected  from  it.  Unac¬ 
customed  to  estimate  the  mode  in  which  the  operation  of  any 
given  institution  is  modified  even  by  such  variety  of  circum¬ 
stances  as  exists  within  a  single  kingdom,  they  flattered  them¬ 
selves  that  they  had  created,  throughout  the  Bengal  provinces, 
English  landlords,  and  it  proved  that  they  had  only  created 
Irish  ones.  The  new  landed  aristocracy  disappointed  every 
expectation  built  upon  them.  They  did  nothing  for  the  im¬ 
provement  of  their  estates,  but  everything  for  their  own  ruin. 
The  same  pains  not  being  taken,  as  had  been  taken  in  Ireland, 
to  enable  the  landlords  to  defy  the  consequences  of  their  im¬ 
providence,  nearly  the  whole  land  of  Bengal  had  to  be  seques¬ 
trated  and  sold,  for  debts  or  arrears  of  revenue,  and  in  one 
generation  most  of  the  ancient  zemindars  had  ceased  to  exist. 
Other  families,  mostly  the  descendants  of  Calcutta  money  deal¬ 
ers,  or  of  native  officials  who  had  enriched  themselves  under 
the  British  government,  now  occupy  their  place ;  and  live  as 
useless  drones  on  the  soil  which  has  been  given  up  to  them. 
Whatever  the  government  has  sacrificed  of  its  pecuniary  claims, 
for  the  creation  of  such  a  class,  has  at  the  best  been  wasted. 

In  the  parts  of  India  into  which  the  British  rule  has  been 
more  recently  introduced,  the  blunder  has  been  avoided  of  en¬ 
dowing  a  useless  body  of  great  landlords  with  gifts  from  the 
public  revenue.  In  most  parts  of  the  Madras  and  in  part  of 
the  Bombay  Presidency,  the  rent  is  paid  directly  to  the  govern- 


MEANS  OF  ABOLISHING  COTTIER  TENANCY  315 


ment  by  the  immediate  cultivator.  In  the  Northwestern  Prov¬ 
inces,  the  government  makes  its  engagement  with  the  village 
community  collectively,  determining  the  share  to  be  paid  by 
each  individual,  but  holding  them  jointly  responsible  for  each 
other’s  default.  But  in  the  greater  part  of  India,  the  immediate 
cultivators  have  not  obtained  a  perpetuity  of  tenure  at  a  fixed 
rent.  The  government  manages  the  land  on  the  principle  on 
which  a  good  Irish  landlord  manages  his  estate:  not  putting 
it  up  to  competition,  not  asking  the  cultivators  what  they  will 
promise  to  pay,  but  determining  for  itself  what  they  can  afford 
to  pay,  and  defining  its  demand  accordingly.  In  many  districts 
a  portion  of  the  cultivators  are  considered  as  tenants  of  the 
rest,  the  government  making  its  demand  from  those  only  (often 
a  numerous  body)  who  are  looked  upon  as  the  successors  of 
the  original  settlers  or  conquerors  of  the  village.  Sometimes 
the  rent  is  fixed  only  for  one  year,  sometimes  for  three  or  five ; 
but  the  uniform  tendency  of  present  policy  is  toward  long  leases, 
extending,  in  the  northern  provinces  of  India,  to  a  term  of  thirty 
years.  This  arrangement  has  not  existed  for  a  sufficient  time  to 
have  shown  by  experience,  how  far  the  motives  to  improvement 
which  the  long  lease  creates  in  the  minds  of  the  cultivators,  fall 
short  of  the  influence  of  a  perpetual  settlement.*  But  the  two 
plans,  of  annual  settlements  and  of  short  leases,  are  irrevocably 
condemned.  They  can  only  be  said  to  have  succeeded,  in  com¬ 
parison  with  the  unlimited  oppression  which  existed  before. 
They  are  approved  by  nobody,  and  were  never  looked  upon  in 
any  other  light  than  as  temporary  arrangements,  to  be  aban¬ 
doned  when  a  more  complete  knowledge  of  the  capabilities  of 
the  country  should  afford  data  for  something  more  permanent. 

Chapter  X. — Means  of  Abolishing  Cottier  Tenancy 

§  1.  When  the  first  edition  of  this  work  was  written  and 
published,  the  question,  what  is  to  be  done  with  a  cottier  popu¬ 
lation,  was  to  the  English  Government  the  most  urgent  of  prac¬ 
tical  questions.  The  majority  of  a  population  of  eight  millions, 
having  long  grovelled  in  helpless  inertness  and  abject  poverty 
under  the  cottier  system,  reduced  by  its  operation  to  mere  food 
of  the  cheapest  description,  and  to  an  incapacity  of  either  doing 

*  Since  this  was  written,  the  resolu-  leases  of  the  Northern  Provinces  into 

tion  has  been  adopted  by  the  Indian  perpetual  tenures  at  fixed  rents. 

Government  of  converting  the  long 


3i6 


POLITICAL  ECONOMY 


or  willing  anything  for  the  improvement  of  their  lot,  had  at 
last,  by  the  failure  of  that  lowest  quality  of  food,  been  plunged 
into  a  state  in  which  the  alternative  seemed  to  be  either  death, 
or  to  be  permanently  supported  by  other  people,  or  a  radical 
change  in  the  economical  arrangements  under  which  it  had 
hitherto  been  their  misfortune  to  live.  Such  an  emergency 
had  compelled  attention  to  the  subject  from  the  legislature  and 
from  the  nation,  but  it  could  hardly  be  said  with  much  result; 
for,  the  evil  having  originated  in  a  system  of  land  tenancy  which 
withdrew  from  the  people  every  motive  to  industry  or  thrift 
except  the  fear  of  starvation,  the  remedy  provided  by  Parlia¬ 
ment  was  to  take  away  even  that,  by  conferring  on  them  a  legal 
claim  to  eleemosynary  support:  while,  toward  correcting  the 
cause  of  the  mischief,  nothing  was  done,  beyond  vain  com¬ 
plaints,  though  at  the  price  to  the  national  treasury  of  ten  mill¬ 
ions  sterling  for  the  delay. 

“  It  is  needless”  (I  observed)  “to  expend  any  argument  in 
proving  that  the  very  foundation  of  the  economical  evils  of 
Ireland  is  the  cottier  system ;  that  while  peasant  rents  fixed 
by  competition  are  the  practice  of  the  country,  to  expect  in¬ 
dustry,  useful  activity,  any  restraint  on  population  but  death, 
or  any  the  smallest  diminution  of  poverty,  is  to  look  for  figs 
on  thistles  and  grapes  on  thorns.  If  our  practical  statesmen 
are  not  ripe  for  the  recognition  of  this  fact ;  or  if  while  they 
acknowledge  it  in  theory,  they  have  not  a  sufficient  feeling  of 
its  reality,  to  be  capable  of  founding  upon  it  any  course  of  con¬ 
duct  ;  there  is  still  another,  and  a  purely  physical  consideration, 
from  which  they  will  find  it  impossible  to  escape.  If  the  one 
crop  on  which  the  people  have  hitherto  supported  themselves 
continues  to  be  precarious,  either  some  new  and  great  impulse 
must  be  given  to  agricultural  skill  and  industry,  or  the  soil  of 
Ireland  can  no  longer  feed  anything  like  its  present  population. 
The  whole  produce  of  the  western  half  of  the  island,  leaving 
nothing  for  rent,  will  not  now  keep  permanently  in  existence 
the  whole  of  its  people:  and  they  will  necessarily  remain  an 
annual  charge  on  the  taxation  of  the  empire,  until  they  are 
reduced  either  by  emigration  or  by  starvation  to  a  number 
corresponding  with  the  low  state  of  their  industry,  or  unless 
the  means  are  found  of  making  that  industry  much  more  pro¬ 
ductive.” 

Since  these  words  were  written,  events  unforeseen  by  anyone 


MEANS  OF  ABOLISHING  COTTIER  TENANCY  317 


have  saved  the  English  rulers  of  Ireland  from  the  embarrass¬ 
ments  which  would  have  been  the  just  penalty  of  their  indiffer¬ 
ence  and  want  of  foresight.  Ireland,  under  cottier  agriculture, 
could  no  longer  supply  food  to  its  population :  Parliament,  by 
way  of  remedy,  applied  a  stimulus  to  population,  but  none 
at  all  to  production;  the  help,  however,  which  had  not  been 
provided  for  the  people  of  Ireland  by  political  wisdom,  came 
from  an  unexpected  source.  Self-supporting  emigration — the 
Wakefield  system,  brought  into  effect  on  the  voluntary  principle 
and  on  a  gigantic  scale  (the  expenses  of  those  who  followed 
being  paid  from  the  earnings  of  those  who  went  before)  has, 
for  the  present,  reduced  the  population  down  to  the  number 
for  which  the  existing  agricultural  system  can  find  employment 
and  support.  The  census  of  1851,  compared  with  that  of  1841, 
showed  in  round  numbers  a  diminution  of  population  of  a  mill¬ 
ion  and  a  half.  The  subsequent  census  (of  1861)  shows  a 
further  diminution  of  about  half  a  million.  The  Irish  having 
thus  found  the  way  to  that  flourishing  continent  which  for  gen¬ 
erations  will  be  capable  of  supporting  in  undiminished  com¬ 
fort  the  increase  of  the  population  of  the  whole  world ;  the 
peasantry  of  Ireland  having  learnt  to  fix  their  eyes  on  a  terres¬ 
trial  paradise  beyond  the  ocean,  as  a  sure  refuge  both  from  the 
oppression  of  the  Saxon  and  from  the  tyranny  of  nature  ;  there 
can  be  little  doubt  that  however  much  the  employment  for  agri¬ 
cultural  labor  may  hereafter  be  diminished  by  the  general  intro¬ 
duction  throughout  Ireland  of  English  farming,  or  even  if  like 
the  county  of  Sutherland  all  Ireland  should  be  turned  into  a 
grazing  farm,  the  superseded  people  would  migrate  to  America 
with  the  same  rapidity,  and  as  free  of  cost  to  the  nation,  as  the 
million  of  Irish  who  went  thither  during  the  three  years  pre¬ 
vious  to  1851.  Those  who  think  that  the  land  of  a  country 
exists  for  the  sake  of  a  few  thousand  landowners,  and  that  as 
long  as  rents  are  paid,  society  and  government  have  fulfilled 
their  function,  may  see  in  this  consummation  a  happy  end  to 
Irish  difficulties. 

But  this  is  not  a  time,  nor  is  the  human  mind  now  in  a  con¬ 
dition,  in  which  such  insolent  pretensions  can  be  maintained. 
The  land  of  Ireland,  the  land  of  every  country,  belongs  to  the 
people  of  that  country.  The  individuals  called  landowners  have 
no  right,  in  morality  and  justice,  to  anything  but  the  rent,  or 
compensation  for  its  salable  value.  With  regard  to  the  land 


POLITICAL  ECONOMY 


3i8 

itself,  the  paramount  consideration  is,  by  what  mode  of  ap¬ 
propriation  and  of  cultivation  it  can  be  made  most  useful  to 
the  collective  body  of  its  inhabitants.  To  the  owners  of  the 
rent  it  may  be  very  convenient  that  the  bulk  of  the  inhabitants, 
despairing  of  justice  in  the  country  where  they  and  their  ances¬ 
tors  have  lived  and  suffered,  should  seek  on  another  continent 
that  property  in  land  which  is  denied  to  them  at  home.  But 
the  legislature  of  the  empire  ought  to  regard  with  other  eyes 
the  forced  expatriation  of  millions  of  people.  When  the  in¬ 
habitants  of  a  country  quit  the  country  en  masse  because  its 
Government  will  not  make  it  a  place  fit  for  them  to  live  in,  the 
Government  is  judged  and  condemned.  There  is  no  necessity 
for  depriving  the  landlords  of  one  farthing  of  the  pecuniary 
value  of  their  legal  rights;  but  justice  requires  that  the  actual 
cultivators  should  be  enabled  to  become  in  Ireland  what  they 
will  become  in  America — proprietors  of  the  soil  which  they 
cultivate. 

Good  policy  requires  it  no  less.  Those  who,  knowing  neither 
Ireland  nor  any  foreign  country,  take  as  their  sole  standard 
of  social  and  economical  excellence  English  practice,  propose 
as  the  single  remedy  for  Irish  wretchedness,  the  transformation 
of  the  cottiers  into  hired  laborers.  But  this  is  rather  a  scheme 
for  the  improvement  of  Irish  agriculture,  than  of  the  condition 
of  the  Irish  people.  The  status  of  a  day  laborer  has  no  charm 
for  infusing  forethought,  frugality,  or  self-restraint,  into  a 
people  devoid  of  them.  If  the  Irish  peasantry  could  be  uni¬ 
versally  changed  into  receivers  of  wages,  the  old  habits  and 
mental  characteristics  of  the  people  remaining,  we  should  merely 
see  four  or  five  millions  of  people  living  as  day  laborers  in  the 
same  wretched  manner  in  which  as  cottiers  they  lived  before; 
equally  passive  in  the  absence  of  every  comfort,  equally  reckless 
in  multiplication,  and  even,  perhaps,  equally  listless  at  their 
work ;  since  they  could  not  be  dismissed  in  a  body,  and  if  they 
could,  dismissal  would  now  be  simply  remanding  them  to  the 
poor-rate.  Far  other  would  be  the  effect  of  making  them  peas¬ 
ant  proprietors.  A  people  who  in  industry  and  providence  have 
everything  to  learn — who  are  confessedly  among  the  most  back¬ 
ward  of  European  populations  in  the  industrial  virtues — re¬ 
quire  for  their  regeneration  the  most  powerful  incitements  by 
which  those  virtues  can  be  stimulated :  and  there  is  no  stimulus 
as  yet  comparable  to  property  in  land.  A  permanent  interest 


MEANS  OF  ABOLISHING  COTTIER  TENANCY 


319 


in  the  soil  to  those  who  till  it,  is  almost  a  guarantee  for  the 
most  unwearied  laboriousness :  against  overpopulation,  though 
not  infallible,  it  is  the  best  preservative  yet  known,  and  where 
it  failed,  any  other  plan  would  probably  fail  much  more  egre- 
giously ;  the  evil  would  be  beyond  the  reach  of  merely  economic 
remedies. 

The  case  of  Ireland  is  similar  in  its  requirements  to  that  of 
India.  In  India,  though  great  errors  have  from  time  to  time 
been  committed,  no  one  ever  proposed,  under  the  name  of  agri¬ 
cultural  improvement,  to  eject  the  ryots  or  peasant  farmers 
from  their  possession ;  the  improvement  that  has  been  looked 
for,  has  been  through  making  their  tenure  more  secure  to  them, 
and  the  sole  difference  of  opinion  is  between  those  who  contend 
for  perpetuity,  and  those  who  think  that  long  leases  will  suffice. 
The  same  question  exists  as  to  Ireland;  and  it  would  be  idle 
to  deny  that  long  leases,  under  such  landlords  as  are  sometimes 
to  be  found,  do  effect  wonders,  even  in  Ireland.  But  then,  they 
must  be  leases  at  a  low  rent.  Long  leases  are  in  no  way  to  be 
relied  on  for  getting  rid  of  cottierism.  During  the  existence  of 
cottier  tenancy,  leases  have  always  been  long ;  twenty-one  years 
and  three  lives  concurrent,  was  a  usual  term.  But  the  rent 
being  fixed  by  competition,  at  a  higher  amount  than  could  be 
paid,  so  that  the  tenant  neither  had,  nor  could,  by  any  exertion 
acquire,  a  beneficial  interest  in  the  land,  the  advantage  of  a 
lease  was  merely  nominal.  In  India,  the  government,  where 
it  has  not  imprudently  made  over  its  proprietary  rights  to  the 
zemindars,  is  able  to  prevent  this  evil,  because,  being  itself  the 
landlord,  it  can  fix  the  rent  according  to  its  own  judgment; 
but  under  individual  landlords,  while  rents  are  fixed  by  compe¬ 
tition,  and  the  competitors  are  a  peasantry  struggling  for  sub¬ 
sistence,  nominal  rents  are  inevitable,  unless  the  population  is 
so  thin,  that  the  competition  itself  is  only  nominal.  The  ma¬ 
jority  of  landlords  will  grasp  at  immediate  money  and  imme¬ 
diate  power;  and  so  long  as  they  find  cottiers  eager  to  offer 
them  everything,  it  is  useless  to  rely  on  them  for  tempering 
the  vicious  practice  by  a  considerate  self-denial. 

A  perpetuity  is  a  stronger  stimulus  to  improvement  than  a 
long  lease :  not  only  because  the  longest  lease,  before  coming 
to  an  end,  passes  through  all  the  varieties  of  short  leases  down 
to  no  lease  at  all ;  but  for  more  fundamental  reasons.  It  is 
very  shallow,  even  in  pure  economics,  to  take  no  account  of  the 


320 


POLITICAL  ECONOMY 


influence  of  imagination:  there  is  a  virtue  in  “  forever  ”  beyond 
the  longest  term  of  years;  even  if  the  term  is  long  enough 
to  include  children,  and  all  whom  a  person  individually  cares 
for,  yet  until  he  has  reached  that  high  degree  of  mental  cultiva¬ 
tion  at  which  the  public  good  (which  also  includes  perpetuity) 
acquires  a  paramount  ascendancy  over  his  feelings  and  desires, 
he  will  not  exert  himself  with  the  same  ardor  to  increase  the 
value  of  an  estate,  his  interest  in  which  diminishes  in  value 
every  year.  Besides,  while  perpetual  tenure  is  the  general  rule 
of  landed  property,  as  it  is  in  all  the  countries  of  Europe,  a 
tenure  for  a  limited  period,  however  long,  is  sure  to  be  regarded 
as  something  of  inferior  consideration  and  dignity,  and  inspires 
less  of  ardor  to  obtain  it,  and  of  attachment  to  it  when  obtained. 
But  where  a  country  is  under  cottier  tenure,  the  question  of 
perpetuity  is  quite  secondary  to  the  more  important  point,  a 
limitation  of  the  rent.  Rent  paid  by  a  capitalist  who  farms  for 
profit,  and  not  for  bread,  may  safely  be  abandoned  to  competi¬ 
tion;  rent  paid  by  laborers  cannot,  unless  the  laborers  were 
in  a  state  of  civilization  and  improvement  which  laborers  have 
nowhere  yet  reached,  and  cannot  easily  reach  under  such  a  ten¬ 
ure.  Peasant  rents  ought  never  to  be  arbitrary,  never  at  the 
discretion  of  the  landlord:  either  by  custom  or  law,  it  is  im¬ 
peratively  necessary  that  they  should  be  fixed;  and  where  no 
mutually  advantageous  custom,  such  as  the  metayer  system  of 
Tuscany,  has  established  itself,  reason  and  experience  recom¬ 
mend  that  they  should  be  fixed  by  authority:  thus  changing 
the  rent  into  a  quit-rent,  and  the  farmer  into  a  peasant  pro¬ 
prietor. 

For  carrying  this  change  into  effect  on  a  sufficiently  large 
scale  to  accomplish  the  complete  abolition  of  cottier  tenancy,  the 
mode  which  most  obviously  suggests  itself  is  the  direct  one,  of 
doing  the  thing  outright  by  Act  of  Parliament ;  making  the 
whole  land  of  Ireland  the  property  of  the  tenants,  subject  to 
the  rents  now  really  paid  (not  the  nominal  rents),  as  a  fixed 
rent  charge.  This,  under  the  name  of  “  fixity  of  tenure,”  was 
one  of  the  demands  of  the  Repeal  Association  during  the  most 
successful  period  of  their  agitation;  and  was  better  expressed 
by  Mr.  Conner,  its  earliest,  most  enthusiastic,  and  most  inde¬ 
fatigable  apostle,*  by  the  words,  “  a  valuation  and  a  perpetuity.” 

*  Author  of  numerous  pamphlets,  en-  sion  of  Ireland,”  and  others.  Mr.  Con- 
titled  “  True  Political  Economy  of  Ire-  ner  has  been  an  agitator  on  the  subject 
land,”  “  Letter  to  the  Earl  of  Devon,”  since  1832. 

“  Two  Letters  on  the  Rackrent  Oppres- 


MEANS  OF  ABOLISHING  COTTIER  TENANCY  321 


In  such  a  measure  there  would  not  have  been  any  injustice, 
provided  the  landlords  were  compensated  for  the  present  value 
of  the  chances  of  increase  which  they  were  prospectively  re¬ 
quired  to  forego.  The  rupture  of  existing  social  relations  would 
hardly  have  been  more  violent  than  that  effected  by  the  min¬ 
isters  Stein  and  Hardenberg,  when,  by  a  series  of  edicts,  in  the 
early  part  of  the  present  century,  they  revolutionized  the  state 
of  landed  property  in  the  Prussian  monarchy,  and  left  their 
names  to  posterity  among  the  greatest  benefactors  of  their 
country.  To  enlightened  foreigners  writing  on  Ireland,  Von 
Raumer  and  Gustave  de  Beaumont,  a  remedy  of  this  sort 
seemed  so  exactly  and  obviously  what  the  disease  required, 
that  they  had  some  difficulty  in  comprehending  how  it  was  that 
the  thing  was  not  yet  done. 

This,  however,  would  have  been,  in  the  first  place,  a  complete 
expropriation  of  the  higher  classes  of  Ireland :  which,  if  there 
is  any  truth  in  the  principles  we  have  laid  down,  would  be  per¬ 
fectly  warrantable,  but  only  if  it  were  the  sole  means  of  effect¬ 
ing  a  great  public  good.  In  the  second  place,  that  there  should 
be  none  but  peasant  proprietors,  is  in  itself  far  from  desirable. 
Large  farms,  cultivated  by  large  capital,  and  owned  by  persons 
of  the  best  education  which  the  country  can  give,  persons  quali¬ 
fied  by  instruction  to  appreciate  scientific  discoveries,  and  able 
to  bear  the  delay  and  risk  of  costly  experiments,  are  an  im¬ 
portant  part  of  a  good  agricultural  system.  Many  such  land¬ 
lords  there  are  even  in  Ireland ;  and  it  would  be  a  public  mis¬ 
fortune  to  drive  them  from  their  posts.  A  large  proportion 
also  of  the  present  holdings  are  probably  still  too  small  to  try 
the  proprietary  system  under  the  greatest  advantages :  nor  are 
the  tenants  always  the  persons  one  would  desire  to  select  as  the 
first  occupants  of  peasant  properties.  There  are  numbers  of 
them  on  whom  it  would  have  a  more  beneficial  effect  to  give 
them  the  hope  of  acquiring  a  landed  property  by  industry  and 
frugality,  than  the  property  itself  in  immediate  possession. 

There  are,  however,  much  milder  measures,  not  open  to  sim¬ 
ilar  objections,  and  which,  if  pushed  to  the  utmost  extent  of 
which  they  are  susceptible,  would  realize  in  no  inconsiderable 
degree  the  object  sought.  One  of  them  would  be,  to  enact  that 
whoever  reclaims  waste  land  becomes  the  owner  of  it,  at  a 
fixed  quit-rent  equal  to  a  moderate  interest  on  its  mere  value 
as  waste.  It  would  of  course  be  a  necessary  part  of  this  meas- 
Vol.  I. — 21 


322 


POLITICAL  ECONOMY 


ure,  to  make  compulsory  on  landlords  the  surrender  of  waste 
lands  (not  of  an  ornamental  character)  whenever  required  for 
reclamation.  Another  expedient,  and  one  in  which  individuals 
could  co-operate,  would  be  to  buy  as  much  as  possible  of  the 
land  offered  for  sale,  and  sell  it  again  in  small  portions  as  peas¬ 
ant  properties.  A  Society  for  this  purpose  was  at  one  time 
projected  (though  the  attempt  to  establish  it  proved  unsuccess¬ 
ful)  on  the  principles,  so  far  as  applicable,  of  the  Freehold 
Land  Societies  which  have  been  so  successfully  established  in 
England,  not  primarily  for  agricultural,  but  for  electoral  pur¬ 
poses. 

This  is  a  mode  in  which  private  capital  may  be  employed  in 
renovating  the  social  and  agricultural  economy  of  Ireland,  not 
only  without  sacrifice,  but  with  considerable  profit  to  its  owners. 
The  remarkable  success  of  the  Waste  Land  Improvement  So¬ 
ciety,  which  proceeded  on  a  plan  far  less  advantageous  to  the 
tenant,  is  an  instance  of  what  an  Irish  peasantry  can  be  stimu¬ 
lated  to  do,  by  a  sufficient  assurance  that  what  they  do  will  be 
for  their  own  advantage.  It  is  not  even  indispensable  to  adopt 
perpetuity  as  the  rule ;  long  leases  at  moderate  rents,  like  those 
of  the  Waste  Land  Society,  would  suffice,  if  a  prospect  were 
held  out  to  the  farmers  of  being  allowed  to  purchase  their  farms 
with  the  capital  which  they  might  acquire,  as  the  Society’s  ten¬ 
ants  were  so  rapidly  acquiring  under  the  influence  of  its  benefi¬ 
cent  system.*  When  the  lands  were  sold,  the  funds  of  the  asso¬ 
ciation  would  be  liberated,  and  it  might  recommence  operations 
in  some  other  quarter. 


*  Though  this  society,  during  the 
years  succeeding  the  famine,  was  forced 
to  wind  up  its  affairs,  the  memory  of 
what  it  accomplished  ought  to  be  pre¬ 
served.  The  following  is  an  extract  in 
the  Proceedings  of  Lord  Devon’s  Com¬ 
mission  (page  84),  from  the  report  made 
to  the  society  in  1845,  by  their  intelli¬ 
gent  manager,  Colonel  Robinson: 

“  Two  hundred  and  forty-five  tenants, 
many  of  whom  were  a  few  years  since 
in  a  state  bordering  on  pauperism,  the 
occupiers  of  small  holdings  of  from  ten 
to  twenty  plantation  acres  each,  have, 
by  their  own  free  labor,  with  the  so¬ 
ciety’s  aid,  improved  their  farms  to  the 
value  of  £4,396;  £605  having  been  added 
during  the  iast  year,  being  at  the  rate  of 
£17  18s.  per  tenant  for  the  whole  term, 
and  £2  9s.  for  the  past  year;  the  benefit 
of  which  improvements  each  tenant  will 
enjoy  during  the  unexpired  term  of  a 
thirty-one  years’  lease. 

“  These  245  tenants  and  their  families 
have,  by  spade  industry,  reclaimed  and 
brought  into  cultivation  1,032  plantation 


acres  of  land,  previously  unproductive 
mountain  waste,  upon  which  they  grew, 
last  year,  crops  valued  by  competent 
practical  persons  at  £3,896,  being  in  the 
proportion  of  £15  18s.  each  tenant;  and 
their  live  stock,  consisting  of  cattle, 
horses,  sheep,  and  pigs,  now  actually 
upon  the  estates,  is  valued,  according 
to  the  present  prices  of  the  neighboring 
markets,  at  £4,162,  of  which  £1,304  has 
been  added  since  February,  1844,  being 
at  the  rate  of  £16  19s.  for  the  whole 
period,  and  £5  6s.  for  the  last  year; 
during  which  time  their  stock  has  thus 
increased  in  value  a  sum  equal  to  their 
present  annual  rent;  and  by  the  statisti¬ 
cal  tables  and  returns  referred  to  in 
previous  reports,  it  is  proved  that  the 
tenants,  in  general,  improve  their  little 
farms,  and  increase  their  cultivation  and 
crops,  in  nearly  direct  proportion  to  the 
number  of  available  working  persons  of 
both  sexes,  of  which  their  families  con¬ 
sist.” 

There  cannot  be  a  stronger  testimony 
to  the  superior  amount  of  gross,  and 


MEANS  OF  ABOLISHING  COTTIER  TENANCY  323 


§  2.  Thus  far  I  had  written  in  1856.  Since  that  time  the 
great  crisis  of  Irish  industry  has  made  further  progress,  and 
it  is  necessary  to  consider  how  its  present  state  affects  the  opin¬ 
ions,  on  prospects  or  on  practical  measures,  expressed  in  the 
previous  part  of  this  chapter. 

The  principal  change  in  the  situation  consists  in  the  great 
diminution,  holding  out  a  hope  of  the  entire  extinction,  of 
cottier  tenure.  The  enormous  decrease  in  the  number  of  small 
holdings  and  increase  in  those  of  a  medium  size,  attested  by  the 
statistical  returns,  sufficiently  prove  the  general  fact,  and  all 
testimonies  show  that  the  tendency  still  continues.*  It  is  prob¬ 
able  that  the  repeal  of  the  corn  laws,  necessitating  a  change  in 
the  exports  of  Ireland  from  the  products  of  tillage  to  those  of 
pasturage,  would  of  itself  have  sufficed  to  bring  about  this 


even  of  net  produce,  raised  by  small 
farming  under  any  tolerable  system  of 
landed  tenure;  and  it  is  worthy  of  at¬ 
tention  that  the  industry  and  zeal  were 
greatest  among  the  smaller  holders; 
Colonel  Robinson  noticing,  as  excep¬ 
tions  to  the  remarkable  and  rapid 
progress  of  improvement,  some  tenants 
who  were  “  occupants  of  larger  farms 
than  twenty  acres,  a  class  too  often 
deficient  in  the  enduring  industry  indis¬ 
pensable  for  the  successful  prosecution 
of  mountain  improvements.” 

*  There  is,  however,  a  partial  counter- 
current,  of  which  I  have  not  seen  any 
public  notice.  “  A  class  of  men,  not 
very  numerous,  but  sufficiently  so  to  do 
much  mischief,  have,  through  the 
Landed  Estates  Court,  got  into  posses¬ 
sion  of  land  in  Ireland,  who,  of  all 
classes,  are  least  likely  to  recognize  the 
duties  of  a  landlord’s  position.  These 
are  small  traders  in  towns,  who  by  dint 
of  sheer  parsimony,  frequently  com¬ 
bined  with  money-lending  at  usurious 
rates,  have  succeeded,  in  the  course  of 
a  long  life,  in  scraping  together  as  much 
money  as  will  enable  them  to  buy  fifty 
or  a  hundred  acres  of  land.  These  peo¬ 
ple  never  think  of  turning  farmers,  but, 
proud  of  their  position  as  landlords,  pro¬ 
ceed  to  turn  it  to  the  utmost  account. 
An  instance  of  this  kind  came  under  my 
notice  lately.  The  tenants  on  the  prop¬ 
erty  were,  at  the  time  of  the  purchase, 
some  twelve  years  ago,  in  a  tolerably 
comfortable  state.  Within  that  period 
their  rent  has  been  raised  three  several 
times;  and  it  is  now,  as  I  am  informed 
by  the  priest  of  the  district,  nearly 
double  its  amount  at  the  commence¬ 
ment  of  the  present  proprietor’s  reign. 
The  result  is  that  the  people,  who  were 
formerly  in  tolerable  comfort,  are  now 
reduced  to  poverty:  two  of  them  have 
left  the  property  and  squatted  near  an 
adjacent  turf  bog,  where  they  exist  trust¬ 
ing  for  support  to  occasional  jobs.  If 
this  man  is  not  shot,  he  will  injure 
himself  through  the  deterioration  of  his 


property,  but  meantime  he  has  been 
getting  eight  or  ten  per  cent,  on  his 
purchase-money.  This  is  by  no  means 
a  rare  case.  The  scandal  which  such 
occurrences  cause,  casts  its  reflection 
on  transactions  of  a  wholly  different  and 
perfectly  legitimate  kind,  where  the  re¬ 
moval  of  the  tenants  is  simply  an  act  of 
mercy  for  all  parties. 

“  The  anxiety  of  landlords  to  get  rid 
of  cottiers  is  also  to  some  extent  neu¬ 
tralized  by  the  anxiety  of  middlemen  to 
get  them.  About  one-fourth  of  the 
whole  land  of  Ireland  is  held  under 
long  leases;  the  rent  received  when  the 
lease  is  of  long  standing,  being  generally 
greatly  under  the  real  value  of  the  land. 
It  rarely  happens  that  land  thus  held 
is  cultivated  by  the  owner  of  the  lease; 
instead  of  this,  he  sublets  it  at  a  rack 
rent  to  small  men,  and  lives  on  the  ex¬ 
cess  of  the  rent  which  he  receives  over 
that  which  he  pays.  Some  of  these 
leases  are  always  running  out;  and  as 
they  draw  towards  their  close,  the  mid¬ 
dleman  has  no  other  interest  in  the  land 
than,  at  any  cost  of  permanent  deterio¬ 
ration,  to  get  the  utmost  out  of  it  during 
the  unexpired  period  of  the  term.  For 
this  purpose  the  small  cottier  tenants 
precisely  answer  his  turn.  Middlemen 
in  this  position  are  as  anxious  to  obtain 
cottiers  as  tenants,  as  the  landlords  are 
to  be  rid  of  them;  and  the  result  is  a 
transfer  of  this  sort  of  tenant  from  one 
class  of  estates  to  the  other.  The  move¬ 
ment  is  of  limited  dimensions,  but  it 
does  exist,  and  so  far  as  it  exists,  neu¬ 
tralizes  the  general  tendency.  Perhaps 
it  may  be  thought  that  this  system  will 
reproduce  itself;  that  the  same  motives 
which  led  to  the  existence  of  middle¬ 
men  will  perpetuate  the  class;  but  there 
is  no  danger  of  this.  Landowners  are 
now  perfectly  alive  to  the  ruinous  con¬ 
sequences  of  this  system,  however  con¬ 
venient  for  a  time;  and  a  clause  against 
sub-letting  is  now  becoming  a  matter  of 
course  in  every  lease.” — (Private  Com¬ 
munication  from  Professor  Cairnes.) 


32  4 


POLITICAL  ECONOMY 


revolution  in  tenure.  A  grazing  farm  can  only  be  managed  by 
a  capitalist  farmer,  or  by  the  landlord.  But  a  change  involving 
so  great  a  displacement  of  the  population,  has  been  immensely 
facilitated  and  made  more  rapid  by  the  vast  emigration,  as  well 
as  by  that  greatest  boon  ever  conferred  on  Ireland  by  any  Gov¬ 
ernment,  the  Encumbered  Estates  Act ;  the  best  provisions  of 
which  have  since,  through  the  Landed  Estates  Court,  been 
permanently  incorporated  into  the  social  system  of  the  coun¬ 
try.  The  greatest  part  of  the  soil  of  Ireland,  there  is  reason  to 
believe,  is  now  farmed  either  by  the  landlords,  or  by  small  cap¬ 
italist  farmers.  That  these  farmers  are  improving  in  circum¬ 
stances,  and  accumulating  capital,  there  is  considerable  evi¬ 
dence,  in  particular  the  great  increase  of  deposits  in  the  banks 
of  which  they  are  the  principal  customers.  So  far  as  that  class 
is  concerned,  the  chief  thing  still  wanted  is  security  of  tenure, 
or  assurance  of  compensation  for  improvements.  The  means 
of  supplying  these  wants  are  now  engaging  the  attention  of  the 
most  competent  minds ;  Judge  Longfield’s  address,  in  the 
autumn  of  1864,  and  the  sensation  created  by  it,  are  an  era  in 
the  subject,  and  a  point  has  now  been  reached  when  we  may 
confidently  expect  that  within  a  very  few  years  something  ef¬ 
fectual  will  be  done. 

But  what,  meanwhile,  is  the  condition  of  the  displaced  cot¬ 
tiers,  so  far  as  they  have  not  emigrated ;  and  of  the  whole  class 
who  subsist  by  agricultural  labor,  without  the  occupation  of 
any  land  ?  As  yet,  their  state  is  one  of  great  poverty,  with  but 
slight  prospect  of  improvement.  Money  wages,  indeed,  have 
risen  much  above  the  wretched  level  of  a  generation  ago :  but 
the  cost  of  subsistence  has  also  risen  so  much  above  the  old 
potato  standard,  that  the  real  improvement  is  not  equal  to  the 
nominal ;  and  according  to  the  best  information  to  which  I 
have  access,  there  is  little  appearance  of  an  improved  standar.d 
of  living  among  the  class.  The  population,  in  fact,  reduced 
though  it  be,  is  still  far  beyond  what  the  country  can  support  as 
a  mere  grazing  district  of  England.  It  may  not,  perhaps,  be 
strictly  true  that,  if  the  present  number  of  inhabitants  are 
to  be  maintained  at  home,  it  can  only  be  either  on  the  old 
vicious  system  of  cottierism,  or  as  small  proprietors  growing 
their  own  food.  The  lands  which  will  remain  under  tillage 
would,  no  doubt,  if  sufficient  security  for  outlay  were  given, 
admit  of  a  more  extensive  employment  of  laborers  by  the  small 


MEANS  OF  ABOLISHING  COTTIER  TENANCY  325 


capitalist  farmers ;  and  this,  in  the  opinion  of  some  competent 
judges,  might  enable  the  country  to  support  the  present  num¬ 
ber  of  its  population  in  actual  existence.  But  no  one  will  pre¬ 
tend  that  this  resource  is  sufficient  to  maintain  them  in  any  con¬ 
dition  in  which  it  is  fit  that  the  great  body  of  the  peasantry  of  a 
country  should  exist.  Accordingly  the  emigration,  which  for 
a  time  had  fallen  off,  has,  under  the  additional  stimulus  of  bad 
seasons,  revived  in  all  its  strength.  It  is  calculated  that  within 
the  year  1864  not  less  than  100,000  emigrants  left  the  Irish 
shores.  As  far  as  regards  the  emigrants  themselves  and  their 
posterity,  or  the  general  interests  of  the  human  race,  it  would 
be  folly  to  regret  this  result.  The  children  of  the  immigrant 
Irish  receive  the  education  of  Americans,  and  enter,  more 
rapidly  and  completely  than  would  have  been  possible  in  the 
country  of  their  descent,  into  the  benefits  of  a  higher  state  of 
civilization.  In  twenty  or  thirty  years  they  are  not  mentally 
distinguishable  from  other  Americans.  The  loss,  and  the  dis¬ 
grace,  are  England’s :  and  it  is  the  English  people  and  govern¬ 
ment  whom  it  chiefly  concerns  to  ask  themselves,  how  far  it 
will  be  to  their  honor  and  advantage  to  retain  the  mere  soil 
of  Ireland,  but  to  lose  its  inhabitants.  With  the  present  feel¬ 
ings  of  the  Irish  people,  and  the  direction  which  their  hope 
of  improving  their  condition  seems  to  be  permanently  taking, 
England,  it  is  probable,  has  only  the  choice  between  the  de¬ 
population  of  Ireland,  and  the  conversion  of  a  part  of  the  labor¬ 
ing  population  into  peasant  proprietors.  The  truly  insular 
ignorance  of  her  public  men  respecting  a  form  of  agricultural 
economy  which  predominates  in  nearly  every  other  civilized 
country,  makes  it  only  too  probable  that  she  will  choose  the 
worse  side  of  the  alternative.  Yet  there  are  germs  of  a  ten¬ 
dency  to  the  formation  of  peasant  proprietors  on  Irish  soil, 
which  require  only  the  aid  of  a  friendly  legislator  to  foster 
them  ;  as  is  shown  in  the  following  extract  from  a  private  com¬ 
munication  by  my  eminent  and  valued  friend,  Professor 
Cairnes : — 

“  On  the  sale,  some  eight  or  ten  years  ago,  of  the  Thomond, 
Portarlington,  and  Kingston  estates,  in  the  Encumbered  Es¬ 
tates  Court,  it  was  observed  that  a  considerable  number  of  oc¬ 
cupying  tenants  purchased  the  fee  of  their  farms.  I  have  not 
been  able  to  obtain  any  information  as  to  what  followed  that 
proceeding — whether  the  purchasers  continued  to  farm  their 


326 


POLITICAL  ECONOMY 


small  properties,  or  under  the  mania  of  landlordism  tried  to  es¬ 
cape  from  their  former  mode  of  life.  But  there  are  other  facts 
which  have  a  bearing  on  this  question.  In  those  parts  of  the 
country  where  tenant-right  prevails,  the  prices  given  for  the 
good  will  of  a  farm  are  enormous.  The  following  figures,  taken 
from  the  schedule  of  an  estate  in  the  neighborhood  of  Newry, 
now  passing  through  the  Landed  Estates  Court,  will  give  an 
idea,  but  a  very  inadequate  one,  of  the  prices  which  this  mere 
customary  right  generally  fetches. 

“  Statement  showing  the  prices  at  which  the  tenant-right  of 
certain  farms  near  Newry  was  sold : — 


Lot 

Acres 

Rent 

Purchase-money 
of  tenant-right 

23 

£74 

£33 

24 

77 

240 

13 

39 

no 

14 

34 

85 

IO 

33 

172 

5 

13 

75 

8 

26 

130 

11 

33 

130 

2 

5 

5 

Total . 

no 

^344 

^980 

“  The  prices  here  represent  on  the  whole  about  three  years’ 
purchase  of  the  rental:  but  this,  as  I  have  said,  gives  but  an 
inadequate  idea  of  that  which  is  frequently,  indeed  of  that  which 
is  ordinarily,  paid.  The  right,  being  purely  customary,  will 
vary  in  value  with  the  confidence  generally  reposed  in  the 
good  faith  of  the  landlord.  In  the  present  instance,  circum¬ 
stances  have  come  to  light  in  the  course  of  the  proceedings  con¬ 
nected  with  the  sale  of  the  estate,  which  give  reason  to  believe 
that  the  confidence  in  this  case  was  not  high ;  consequently, 
the  rates  above  given  may  be  taken  as  considerably  under  those 
which  ordinarily  prevail.  Cases,  as  I  am  informed  on  the 
highest  authority,  have  in  other  parts  of  the  country  come  to 
light,  also  in  the  Landed  Estates  Court,  in  which  the  price  given 
for  the  tenant-right  was  equal  to  that  of  the  whole  fee  of  the 
land.  It  is  a  remarkable  fact  that  people  should  be  found  to 
give,  say  twenty  or  twenty-five  years’  purchase,  for  land  which 
is  still  subject  to  a  good  round  rent.  Why,  it  will  be  asked,  do 


MEANS  OF  ABOLISHING  COTTIER  TENANCY  327 


they  not  purchase  land  out  and  out  for  the  same,  or  a  slightly 
larger,  sum?  The  answer  to  this  question,  I  believe,  is  to  be 
found  in  the  state  of  our  land  laws.  The  cost  of  transferring 
land  in  small  portions  is,  relatively  to  the  purchase  money,  very 
considerable,  even  in  the  Landed  Estates  Court ;  while  the 
good  will  of  a  farm  may  be  transferred  without  any  cost  at  all. 
The  cheapest  conveyance  that  could  be  drawn  in  that  Court, 
where  the  utmost  economy,  consistent  with  the  present  mode 
of  remunerating  legal  services,  is  strictly  enforced,  would,  irre¬ 
spective  of  stamp  duties,  cost  f  10 — a  very  sensible  addition  to 
the  purchase  of  a  small  peasant  estate :  a  conveyance  to  trans¬ 
fer  a  thousand  acres  might  not  cost  more,  and  would  probably 
not  cost  much  more.  But  in  truth,  the  mere  cost  of  conveyance 
represents  but  the  least  part  of  the  obstacles  which  exist  to  ob¬ 
taining  land  in  small  portions.  A  far  more  serious  impediment 
is  the  complicated  state  of  the  ownership  of  land,  which  renders 
it  frequently  impracticable  to  subdivide  a  property  into  such 
portions  as  would  bring  the  land  within  the  reach  of  small  bid¬ 
ders.  The  remedy  for  this  state  of  things,  however,  lies  in 
measures  of  a  more  radical  sort  than  I  fear  it  is  at  all  probable 
that  any  House  of  Commons  we  are  soon  likely  to  see  would 
even  with  patience  consider.  A  registry  of  titles  may  succeed 
in  reducing  this  complex  condition  of  ownership  to  its  simplest 
expression ;  but  where  real  complication  exists,  the  difficulty 
is  not  to  be  got  rid  of  by  mere  simplicity  of  form ;  and  a  regis¬ 
try  of  titles — while  the  powers  of  disposition  at  present  enjoyed 
by  landowners  remain  undiminished,  while  every  settler  and 
testator  has  an  almost  unbounded  license  to  multiply  interests 
in  land,  as  pride,  the  passion  for  dictation,  or  mere  whim  may 
suggest — will,  in  my  opinion,  fail  to  reach  the  root  of  the  evil. 
The  effect  of  these  circumstances  is  to  place  an  immense  pre¬ 
mium  upon  large  dealings  in  land — indeed  in  most  cases  prac¬ 
tically  to  preclude  all  other  than  large  dealings ;  and  while  this 
is  the  state  of  the  law,  the  experiment  of  peasant  proprietor¬ 
ship,  it  is  plain,  cannot  be  fairly  tried.  The  facts,  however, 
which  I  have  stated  show,  I  think,  conclusively,  that  there  is  no 
obstacle  in  the  disposition  of  the  people  to  the  introduction  of 
this  system/’ 

I  have  concluded  a  discussion,  which  has  occupied  a  space 
almost  disproportioned  to  the  dimensions  of  this  work ;  and 
I  here  close  the  examination  of  those  simpler  forms  of  social 


328 


POLITICAL  ECONOMY 


economy  in  which  the  produce  of  the  land  either  belongs  un- 
dividedly  to  one  class,  or  is  shared  only  between  two  classes. 
We  now  proceed  to  the  hypothesis  of  a  threefold  division  of 
the  produce,  among  laborers,  landlords,  and  capitalists ;  and 
in  order  to  connect  the  coming  discussion  as  closely  as  pos¬ 
sible  with  those  which  have  now  for  some  time  occupied  us,  I 
shall  commence  with  the  subject  of  Wages.  . 


Chapter  XI. — Of  Wages 

§  i.  Under  the  head  of  Wages  are  to  be  considered,  first, 
the  causes  which  determine  or  influence  the  wages  of  labor 
generally,  and  secondly,  tjie  differences  that  exist  between  the 
wages  of  different  employments.  It  is  convenient  to  keep  these 
two  classes  of  consideration  separate ;  and  in  discussing  the 
law  of  wages,  to  proceed  in  the  first  instance  as  if  there  were  no 
other  kind  of  labor  than  common  unskilled  labor,  of  the  aver- 
age  degree  of  hardness  and  disagreeableness. 

Wa^es,  like  other  things,  may  be  regulated  either  by  com¬ 
petition  or  by  custom.  In  this  country  there  are  few  kinds  of 
labor  of  which  the  remuneration  would  not  be  lower  than  it 
is,  if  the  employer  took  the  full  advantage  of  competition.  Com¬ 
petition,  however,  must  be  regarded,  in  the  present  state  of  so¬ 
ciety,  as  the  principal  regulator  of  wages,  and  custom  or  in¬ 
dividual  character  only  as  a  modifying  circumstance,  and  that 
in  a  comparatively  slight  degree. 

Wages,  then,  depend  mainly  upon  the  demand  and  supply 
of  labor ;  or  as  it  is  often  expressed,  on  the  proportion  be¬ 
tween population  and  capital.  By  population  is  here  meant 
the  number  only  of  the  laboring  class,  or  ratHer  of  those  who 
work  for  hire ;  and  by  capital,  only  circulating  capital,  and 
not  even  the  whole  of  that,  but  the  part  which  is  expen  dedjn 
{he  direct  purchase  of  labor.  To  this,  however,  must  be  added 
all  funds  which,  without  forming  a  part  of  capital,  are  paid  in 
exchange  for  labor,  such  as  the  wages  of  soldiers,  domestic 
servants,  and  all  other  unproductive  laborers.  There  is  un- 
fortunately  no  mode  of  expressing  by  one  familiar  term,  the 
aggregate  of  what  may  be  called  the  wages-tund  oi  a  country  : 
and  as  the  wages  ol  productive  labor  form  nearly  th**  ™hn1p  fff 
that  fund,  it  is  usual  to  overlook  the  smallerand  less  important 


WAGES 


329 


?art,  and  to  say  that  wages  depend  on  population  and  capital, 
t  Will  be  Convenient  tQ  employ  this  pypre^ion,  r^mprnhprinor, 
fiowever,  to  consider  it  as  elliptical,  and  not  as  a  literal  state¬ 
ment  of  the  entire  truth. 

With  these  limitations  of  the  terms,  wages  not  only  depend 
upon  the  relative  amount  of  capital  and  population,  but  cannot. 
under  the  rule  of  competition,  be  affected  by  anything  else. 
Wages  (meaning,  of  course,  the  general  rate)  cannot  rise,  but 
Tjy  an  increase  of  the  aggregate  funds  employed  in  hiring  la¬ 
borers,  or  a  diminution  in  the  number  of  the  competitors  for 
Vi 7^7  nor  fall,  except  either  by  a  diminution  of  the  funds  de¬ 
voted  to  paying  labor,  or  by  an  increase  in  the  number  of 
laborers  to  be  paid. 

§  2.  There  are,  however,  some  facts  in  apparent  contradic¬ 
tion  to  this  doctrine,  which  it  is  incumbent  on  us  to  consider 
and  explain. 

For  instance,  it  is  a  common  saying  that  wages  are  high  * 
when  trade  is  good.  The  demand  for  labor  in  any  particular 
employment  is  more  pressing,  and  higher  wages  are  paid,  when 
there  is  a  brisk  demand  for  the  commodity  produced ;  and  the 
contrary  when  there  is  what  is  called  a  stagnation  :  then  work¬ 
people  are  dismissed,  and  those  who  are  retained  must  sub¬ 
mit  to  a  reduction  of  wages :  though  in  these  cases  there  is 
neither  more  nor  less  capital  than  before.  This  is  true ;  and 
is  one  of  those  complications  in  the  concrete  phenomena,  which 
obscure  and  disguise  the  operation  of  general  causes ;  but  it 
is  not  really  inconsistent  with  the  principles  laid  down.  Capi¬ 
tal  which  the  owner  does  not  employ  in  purchasing  labor,  but 
keeps  idle  in  his  hands,  is  the  same  thing  to  the  laborers,  for  the 
time  being,  as  if  it  did  not  exist.  All  capital  is,  from  the  varia¬ 
tions  of  trade,  occasionally  in  this  state.  A  manufacturer,  find¬ 
ing  a  slack  demand  for  his  commodity,  forbears  to  employ  la¬ 
borers  in  increasing  a  stock  which  he  finds  it  difficult  to  dispose 
of ;  or  if  he  goes  on  until  all  his  capital  is  locked  up  in  unsold 
goods,  then  at  least  he  must  of  necessity  pause  until  he  can  get 
paid  for  some  of  them.  But  no  one  expects  either  of  these 
states  to  be  permanent ;  if  he  did,  he  would  at  the  first  oppor¬ 
tunity  remove  his  capital  to  some  other  occupation,  in  which 
it  would  still  continue  to  employ  labor.  The  capital  remains 
unemployed  for  a  time,  during  which  the  labor  market  is  over¬ 
stocked,  and  wages  fall.  Afterwards  the  demand  revives,  and 


330 


POLITICAL  ECONOMY 


perhaps  becomes  unusually  brisk,  enabling  the  manufacturer 
to  sell  his  commodity  even  faster  than  he  can  produce  it:  his 
whole  capital  is  then  brought  into  complete  efficiency,  and  if 
he  is  able,  he  borrows  capital  in  addition,  which  would  other¬ 
wise  have  gone  into  some  other  employment.  At  such  times 
wages,  in  his  particular  occupation,  rise.  If  we  suppose,  what 
in  strictness  is  not  absolutely  impossible,  that  one  of  these  fits 
of  briskness  or  of  stagnation  should  affect  all  occupations  at 
the  same  time,  wages  altogether  might  undergo  a  rise  or  a  fall. 
These,  however,  are  but  temporary  fluctuations :  the  capital 
now  lying  idle  will  next  year  be  in  active  employment,  that 
which  is  this  year  unable  to  keep  up  with  the  demand  will  in  its 
turn  be  locked  up  in  crowded  warehouses ;  and  wages  in  these 
several  departments  will  ebb  and  flow  accordingly:  but  noth¬ 
ing  can  permanently  alter  general  wages,  except  an  increase  or 
a  diminution  of  capital  itself  (always  meaning  by  the  term,  the 
funds  of  all  sorts,  destined  for  the  payment  of  labor)  com¬ 
pared  with  the  quantity  of  labor  offering  itself  to  be  hired. 

Again,  it  is  another  common  notion  that  high  prices  make 
high  wages ;  because  the  producers  and  dealers,  being  better 
off,  can  afford  to  pay  more  to  their  laborers.  I  have  already 
said  that  a  brisk  demand,  which  causes  temporary  high  prices, 
causes  also  temporary  high  wages.  But  high  prices,  in  them¬ 
selves,  can  only  raise  wages  if  the  dealers,  receiving  more,  are 
induced  to  save  more,  and  make  an  addition  to  their  capital, 
or  at  least  to  their  purchases  of  labor.  This  is  indeed  likely 
enough  to  be  the  case ;  and  if  the  high  prices  came  direct  from 
heaven,  or  even  from  abroad,  the  laboring  class  might  be  bene¬ 
fited,  not  by  the  high  prices  themselves,  but  by  the  increase  of 
capital  occasioned  by  them.  The  same  effect,  however,  is  often 
attributed  to  a  high  price  which  is  the  result  of  restrictive  laws, 
or  which  is  in  some  way  or  other  to  be  paid  by  the  remaining 
members  of  the  community ;  they  having  no  greater  means 
than  before  to  pay  it  with.  High  prices  of  this  sort,  if  they  ben¬ 
efit  one  class  of  laborers,  can  only  do  so  at  the  expense  of 
others  ;  since  if  the  dealers  by  receiving  high  prices  are  enabled 
to  make  greater  savings,  or  otherwise  increase  their  purchases 
of  labor,  all  other  people  by  paying  those  high  prices,  have 
their  means  of  saving,  or  of  purchasing  labor,  reduced  in  an 
equal  degree ;  and  it  is  a  matter  of  accident  whether  the  one 
alteration  or  the  other  will  have  the  greatest  effect  on  the  labor 


WAGES 


331 


market.  Wages  will  probably  be  temporarily  higher  in  the 
employment  in  which  prices  have  risen,  and  somewhat  lower 
in  other  employments :  in  which  case,  while  the  first  half  of 
the  phenomenon  excites  notice,  the  other  is  generally  over¬ 
looked,  or  if  observed,  is  not  ascribed  to  the  cause  which  really 
produced  it.  Nor  will  the  partial  rise  of  wages  last  long:  for 
though  the  dealers  in  that  one  employment  gain  more,  it  does 
not  follow  that  there  is  room  to  employ  a  greater  amount  of 
savings  in  their  own  business :  their  increasing  capital  will 
probably  flow  over  into  other  employments,  and  there  counter¬ 
balance  the  diminution  previously  made  in  the  demand  for 
labor  by  the  diminished  savings  of  other  classes. 

Another  opinion  often  maintained  is,  that  wages  (meaning 
of  course  money  wages)  vary  with  the  price  of  food ;  rising 
when  it  rises,  and  falling  when  it  falls.  This  opinion  is,  I  con¬ 
ceive,  only  partially  true :  and  in  so  far  as  true,  in  no  way 
affects  the  dependence  of  wages  on  the  proportion  between 
capital  and  labor :  since  the  price  of  food,  when  it  affects  wages 
at  all,  affects  them  through  that  law.  Dear  or  cheap  food 
caused  by  variety  of  seasons  does  not  affect  wages  (unless  they 
are  artificially  adjusted  to  it  by  law  or  charity) :  or  rather,  it 
has  some  tendency  to  affect  them  in  the  contrary  way  to  that 
supposed ;  since  in  times  of  scarcity  people  generally  compete 
more  violently  for  employment,  and  lower  the  labor  market 
against  themselves.  But  dearness  or  cheapness  of  food,  when 
of  a  permanent  character,  and  capable  of  being  calculated  on 
beforehand,  may  affect  wages.  In  the  first  place,  if  the  laborers 
have,  as  is  often  the  case,  no  more  than  enough  to  keep  them  in 
working  condition,  and  enable  them  barely  to  support  the  ordi¬ 
nary  number  of  children,  it  follows  that  if  food  grows  per¬ 
manently  dearer  without  a  rise  of  wages,  a  greater  number  of 
the  children  will  prematurely  die ;  and  thus  wages  will  ulti¬ 
mately  be  higher,  but  only  because  the  number  of  people  will 
be  smaller,  than  if  food  had  remained  cheap.  But,  secondly, 
even  though  wages  were  high  enough  to  admit  of  food’s  be¬ 
coming  more  costly  without  depriving  the  laborers  and  their 
families  of  necessaries ;  though  they  could  bear,  physically 
speaking,  to  be  worse  off,  perhaps  they  would  not  consent  to  be 
so.  They  might  have  habits  of  comfort  which  were  to  them  as 
necessaries,  and  sooner  than  forego  which,  they  would  put  an 
additional  restraint  on  their  power  of  multiplication ;  so  that 


332 


POLITICAL  ECONOMY 


wages  would  rise,  not  by  increase  of  deaths  but  by  diminution 
of  births.  In  these  cases,  then,  wages  do  adapt  themselves  to 
the  price  of  food,  though  after  an  interval  of  almost  a  genera¬ 
tion.  Mr.  Ricardo  considers  these  two  cases  to  comprehend 
all  cases.  He  assumes,  that  there  is  everywhere  a  minimum 
rate  of  wages  :  either  the  lowest  with  which  it  is  physically  pos¬ 
sible  to  keep  up  the  population,  or  the  lowest  with  which  the 
people  will  choose  to  do  so.  To  this  minimum  he  assumes  that 
the  general  rate  of  wages  always  tends ;  that  they  can  never 
be  lower,  beyond  the  length  of  time  required  for  a  diminished 
rate  of  increase  to  make  itself  felt,  and  can  never  long  continue 
higher.  This  assumption  contains  sufficient  truth  to  render  it 
admissible  for  the  purposes  of  abstract  science ;  and  the  con¬ 
clusion  which  Mr.  Ricardo  draws  from  it,  namely,  that  wages 
in  the  long  run  rise  and  fall  with  the  permanent  rise  of  food,  is, 
like  almost  all  his  conclusions,  true  hypothetically,  that  is, 
granting  the  suppositions  from  which  he  sets  out.  But  in  the 
application  to  practice,  it  is  necessary  to  consider  that  the  min¬ 
imum  of  which  he  speaks,  especially  when  it  is  not  a  physical, 
but  what  may  be  termed  a  moral  minimum,  is  itself  liable  to 
vary.  If  wages  were  previously  so  high  that  they  could  bear 
reduction,  to  which  the  obstacle  was  a  high  standard  of  com¬ 
fort  habitual  among  the  laborers,  a  rise  of  the  price  of  food, 
or  any  other  disadvantageous  change  in  their  circumstances, 
may  operate  in  two  ways :  it  may  correct  itself  by  a  rise  of 
wages,  brought  about  through  a  gradual  effect  on  the  pruden¬ 
tial  check  of  population ;  or  it  may  permanently  lower  the 
standard  of  living  of  the  class,  in  case  their  previous  habits  in 
respect  of  population  prove  stronger  than  their  previous  habits 
in  respect  of  comfort.  In  that  case  the  injury  done  to  them 
will  be  permanent,  and  their  deteriorated  condition  will  be¬ 
come  a  new  minimum,  tending  to  perpetuate  itself  as  the  more 
ample  minimum  did  before.  It  is  to  be  feared  that  of  the  two 
modes  in  which  the  cause  may  operate,  the  last  is  the  most  fre¬ 
quent,  or  at  all  events  sufficiently  so,  to  render  all  propositions 
ascribing  a  self-repairing  quality  to  the  calamities  which  befall 
the  laboring  classes,  practically  of  no  validity.  There  is  con¬ 
siderable  evidence  that  the  circumstances  of  the  agricultural 
laborers  in  England  have  more  than  once  in  our  history  sus¬ 
tained  great  permanent  deterioration,  from  causes  which 
operated  by  diminishing  the  demand  for  labor,  and  which,  if 


WAGES 


333 


population  had  exercised  its  power  of  self-adjustment  in  obedi¬ 
ence  to  the  previous  standard  of  comfort,  could  only  have  had  a 
temporary  effect :  but  unhappily  the  poverty  in  which  the  class 
was  plunged  during  a  long  series  of  years,  brought  that  pre¬ 
vious  standard  into  disuse ;  and  the  next  generation,  growing 
up  without  having  possessed  those  pristine  comforts,  multi¬ 
plied  in  turn  without  any  attempt  to  retrieve  them.* 

The  converse  case  occurs  when,  by  improvements  in  agri¬ 
culture,  the  repeal  of  corn  laws,  or  other  such  causes,  the  neces¬ 
saries  of  the  laborers  are  cheapened,  and  they  are  enabled  with 
the  same  wages,  to  command  greater  comforts  than  before. 
Wages  will  not  fall  immediately ;  it  is  even  possible  that  they 
may  rise ;  but  they  will  fall  at  last,  so  as  to  leave  the  laborers 
no  better  off  than  before,  unless,  during  this  interval  of  pros¬ 
perity,  the  standard  of  comfort  regarded  as  indispensable  by 
the  class,  is  permanently  raised.  Unfortunately  this  salutary 
effect  is  by  no  means  to  be  counted  upon :  it  is  a  much  more 
difficult  thing  to  raise,  than  to  lower,  the  scale  of  living  which 
the  laborers  will  consider  as  more  indispensable  than  marrying 
and  having  a  family.  If  they  content  themselves  with  enjoying 
the  greater  comfort  while  it  lasts,  but  do  not  learn  to  require  it, 
they  will  people  down  to  their  old  scale  of  living.  If  from  pov¬ 
erty  their  children  had  previously  been  insufficiently  fed  or  im¬ 
properly  nursed,  a  greater  number  will  now  be  reared,  and  the 
competition  of  these,  when  they  grow  up,  will  depress  wages, 
probably  in  full  proportion  to  the  greater  cheapness  of  food. 
If  the  effect  is  not  produced  in  this  mode,  it  will  be  produced  by 
earlier  and  more  numerous  marriages,  or  by  an  increased  num¬ 
ber  of  births  to  a  marriage.  According  to  all  experience,  a  great 
increase  invariably  takes  place  in  the  number  of  marriages,  in 
seasons  of  cheap  food  and  full  employment.  I  cannot,  there¬ 
fore,  agree  in  the  importance  so  often  attached  to  the  repeal  ol 
the  corn  laws,  considered  merely  as  a  laborer’s  question,  or  to 
any  of  the  schemes,  of  which  some  one  or  other  is  at  all  times 
in  vogue,  for  making  the  laborers  a  very  little  better  off. 
Things  which  only  affect  them  a  very  little,  make  no  perma¬ 
nent  impression  upon  their  habits  and  requirements,  and  they 


*  See  the  historical  sketch  of  the  con¬ 
dition  of  the  English  peasantry,  pre¬ 
pared  from  the  best  authorities  by  Mr. 
William  Thornton,  in  his  work  entitled 
“  Over-  Population  and  Its  Remedy”:  a 
work  honorably  distinguished  from  most 


others  which  have  been  published  in  the 
present  generation,  by  its  rational  treat¬ 
ment  of  questions  affecting  the  eco¬ 
nomical  condition  of  the  laboring 
classes. 


334 


POLITICAL  ECONOMY 


soon  slide  back  into  their  former  state.  To  produce  permanent 
advantage,  the  temporary  cause  operating  upon  them  must  be 
sufficient  to  made  a  great  change  in  their  condition — a  change 
such  as  will  be  felt  for  many  years,  notwithstanding  any  stimu¬ 
lus  which  it  may  give  during  one  generation  to  the  increase  of 
people.  When,  indeed,  the  improvement  is  of  this  signal  char¬ 
acter,  and  a  generation  grows  up  which  has  always  been  used 
to  an  improved  scale  of  comfort,  the  habits  of  this  new  genera¬ 
tion  in  respect  to  population  become  formed  upon  a  higher 
minimum,  and  the  improvement  in  their  condition  becomes 
permanent.  Of  cases  in  point,  the  most  remarkable  is  France 
after  the  Revolution.  The  majority  of  the  population  being 
suddenly  raised  from  misery,  to  independence  and  comparative 
comfort ;  the  immediate  effect  was  that  population,  notwith¬ 
standing  the  destructive  wars  of  the  period,  started  forward 
with  unexampled  rapidity,  partly  because  improved  circum¬ 
stances  enabled  many  children  to  be  reared  who  would  other¬ 
wise  have  died,  and  partly  from  increase  of  births.  The  suc¬ 
ceeding  generation  however  grew  up  with  habits  considerably 
altered ;  and  though  the  country  was  never  before  in  so  pros¬ 
perous  a  state,  the  annual  number  of  births  is  now  nearly  sta¬ 
tionary,*  and  the  increase  of  population  extremely  slow.f 
§  3.  Wages  depend,  then,  on  the  proportion  between  the 
number  of  the  laboring  population,  and  the  capital  or  other 
funds  devoted  to  the  purchase  of  labor ;  we  will  say,  for  short¬ 
ness,  the  capital.  If  wages  are  higher  at  one  time  or  place  than 
at  another,  if  the  subsistence  and  comfort  of  the  class  of  hired 
laborers  are  more  ample,  it  is  for  no  other  reason  than  because 
capital  bears  a  greater  proportion  to  population.  It  is  not  the 
absolute  amount  of  accumulation  or  of  production,  that  is  of 


*  Supra,  pp.  177,  178. 
t  A  similar,  though  not  an  equal  im¬ 
provement  in  the  standard  of  living  took 
place  among  the  laborers  of  England 
during  the  remarkable  fifty  years  from 
1715  to  1765,  which  were  distinguished 
by  such  an  extraordinary  succession  of 
fine  harvests  (the  years  of  decided  defi¬ 
ciency  not  exceeding  five  in  all  that 
period)  that  the  average  price  of  wheat 
during  those  years  was  much  lower  than 
during  the  previous  half  century.  Mr. 
Malthus  computes  that  on  the  average 
of  sixty  years  preceding  1720,  the  la¬ 
borer  could  purchase  with  a  day’s  earn¬ 
ings  only  two-thirds  of  a  peck  of  wheat, 
while  from  1720  to  1750  he  could  pur¬ 
chase  a  whole  peck.  The  average  price 
of  wheat  according  to  the  Eton  tables, 
for  fifty  years  ending  with  1715,  was  41s. 


7%d.  the  quarter,  and  for  the  last  twenty- 
three  of  these,  45s.  8d.,  while  for  the 
fifty  years  following,  it  was  no  more 
than  34s.  1  id.  So  considerable  an  im¬ 
provement  in  the  condition  of  the  labor¬ 
ing  class,  though  arising  from  the  acci¬ 
dents  of  seasons,  yet  continuing  for  more 
than  a  generation,  had  time  to  work  a 
change  in  the  habitual  requirements  pf 
the  laboring  class;  and  this  period  is 
always  noted  as  the  date  of  “a  marked 
improvement  of  the  quality  of  the  food 
consumed,  and  a  decided  elevation  in 
the  standard  of  their  comforts  and  con¬ 
veniences.” — (Malthus,  “  Principles  of 
Political  Economy,”  p.  225.)  For  the 
character  of  the  period,  see  Mr.  Tooke’s 
excellent  “  History  of  Prices,”  vol.  i. 
pp.  38  to  6 1,  and  for  the  prices  of  corn, 
the  Appendix  to  that  work. 


WAGES 


335 


importance  to  the  laboring  class ;  it  is  not  the  amount  even  of 
the  funds  destined  for  distribution  among  the  laborers :  it  is 
the  proportion  between  those  funds  and  the  numbers  among 
whom  they  are  shared.  The  condition  of  the  class  can  be  bet¬ 
tered  in  no  other  way  than  by  altering  that  proportion  to  their 
advantage :  and  every  scheme  for  their  benefit,  which  does 
not  proceed  on  this  as  its  foundation,  is,  for  all  permanent  pur¬ 
poses,  a  delusion. 

In  countries  like  North  America  and  the  Australian  colonies, 
where  the  knowledge  and  arts  of  civilized  life,  and  a  high 
effective  desire  of  accumulation,  co-exist  with  a  boundless  ex¬ 
tent  of  unoccupied  land ;  the  growth  of  capital  easily  keeps 
pace  with  the  utmost  possible  increase  of  population,  and  is 
chiefly  retarded  by  the  impracticability  of  obtaining  laborers 
enough.  All,  therefore,  who  can  possibly  be  born,  can  find 
employment  without  overstocking  the  market:  every  labor¬ 
ing  family  enjoys  in  abundance  the  necessaries,  many  of  the 
comforts,  and  some  of  the  luxuries  of  life ;  and,  unless  in  case 
of  individual  misconduct,  or  actual  inability  to  work,  poverty 
does  not,  and  dependence  needs  not,  exist.  A  similar  advan¬ 
tage,  though  in  a  less  degree,  is  occasionally  enjoyed  by  some 
special  class  of  laborers  in  old  countries,  from  an  extraordinar¬ 
ily  rapid  growth,  not  of  capital  generally,  but  of  the  capital 
employed  in  a  particular  occupation.  So  gigantic  has  been  the 
progress  of  the  cotton  manufacture  since  the  inventions  of  Watt 
and  Arkwright,  that  the  capital  engaged  in  it  has  probably 
quadrupled  in  the  time  which  population  requires  for  doubling. 
While,  therefore,  it  has  attracted  from  other  employments 
nearly  all  the  hands  which  geographical  circumstances  and  the 
habits  or  inclinations  of  the  people  rendered  available ;  and 
while  the  demand  it  created  for  infant  labor  has  enlisted  the  im¬ 
mediate  pecuniary  interest  of  the  operatives  in  favor  of  pro¬ 
moting,  instead  of  restraining,  the  increase  of  population ; 
nevertheless  wages  in  the  great  seats  of  the  manufacture  are 
generally  so  high,  that  the  collective  earnings  of  a  family 
amount,  on  an  average  of  years,  to  a  very  satisfactory  sum  ;  and 
there  is,  as  yet,  no  sign  of  permanent  decrease,  while  the  ef¬ 
fect  has  also  been  felt  in  raising  the  general  standard  of  agricul¬ 
tural  wages  in  the  counties  adjoining. 

But  those  circumstances  of  a  country,  or  of  an  occupation, 
in  which  population  can  with  impunity  increase  at  its  utmost 


336 


POLITICAL  ECONOMY 


rate,  are  rare,  and  transitory.  Very  few  are  the  countries  pre¬ 
senting  the  needful  union  of  conditions.  Either  the  industrial 
arts  are  backward  and  stationary,  and  capital  therefore  in¬ 
creases  slowly ;  or  the  effective  desire  of  accumulation  being 
low,  the  increase  soon  reaches  its  limit ;  or,  even  though  both 
these  elements  are  at  their  highest  known  degree,  the  increase 
of  capital  is  checked,  because  there  is  not  fresh  land  to  be  re¬ 
sorted  to,  of  as  good  quality  as  that  already  occupied.  Though 
capital  should  for  a  time  double  itself  simultaneously  with  popu¬ 
lation,  if  all  this  capital  and  population  are  to  find  employment 
on  the  same  land,  they  cannot  without  an  unexampled  succes¬ 
sion  of  agricultural  inventions  continue  doubling  the  produce ; 
therefore,  if  wages  do  not  fall,  profits  must ;  and  when  profits 
fall,  increase  of  capital  is  slackened.  Besides,  even  if  wages  did 
not  fall,  the  price  of  food  (as  will  be  shown  more  fully  hereafter) 
would  in  these  circumstances  necessarily  rise ;  which  is  equiva¬ 
lent  to  a  fall  of  wages. 

Except,  therefore,  in  the  very  peculiar  cases  which  I  have  just 
noticed,  of  which  the  only  one  of  any  practical  importance  is 
that  of  a  new  colony,  or  a  country  in  circumstances  equivalent 
to  it ;  it  is  impossible  that  population  should  increase  at  its 
utmost  rate  without  lowering  wages.  Nor  will  the  fall  be 
stopped  at  any  point,  short  of  that  which  either  by  its  physical 
or  its  moral  operation,  checks  the  increase  of  population.  In 
no  old  country,  therefore,  does  population  increase  at  anything 
like  its  utmost  rate  ;  in  most,  at  a  very  moderate  rate :  in  some 
countries  not  at  all.  These  facts  are  only  to  be  accounted  for  in 
two  ways.  Either  the  whole  number  of  births  which  nature 
admits  of,  and  which  happen  in  some  circumstances,  do  not 
take  place ;  or  if  they  do,  a  large  proportion  of  those  who  are 
born,  die.  The  retardation  of  increase  results  either  from  mor¬ 
tality  or  prudence ;  from  Mr.  Malthus’s  positive,  or  from  his 
preventive  check :  and  one  or  the  other  of  these  must  and  does 
exist,  and  very  powerfully  too,,  in  all  old  societies.  Wherever 
population  is  not  kept  down  by  the  prudence  either  of  indi¬ 
viduals  or  of  the  state,  it  is  kept  down  by  starvation  or  disease. 

Mr.  Malthus  has  taken  great  pains  to  ascertain,  for  almost 
every  country  in  the  world,  which  of  these  checks  it  is  that 
operates:  and  the  evidence  which  he  collected  on  the  subject, 
in  his  Essay  on  Population,  may  even  now  be  read  with  advan¬ 
tage.  Throughout  Asia,  and  formerly  in  .most  European  coun- 


WAGES 


337 


tries  in  which  the  laboring  classes  were  not  in  personal  bond¬ 
age,  there  is,  or  was,  no  restrainer  of  population  but  death.  The 
mortality  was  not  always  the  result  of  poverty :  much  of  it  pro¬ 
ceeded  from  unskilful  and  careless  management  of  children, 
from  uncleanly  and  otherwise  unhealthy  habits  of  life  among 
the  adult  population,  and  from  the  almost  periodical  occur¬ 
rence  of  destructive  epidemics.  Throughout  Europe  these 
causes  of  shortened  life  have  much  diminished,  but  they  have 
not  ceased  to  exist.  Until  a  period  not  very  remote,  hardly  any 
of  our  large  towns  kept  up  its  population,  independently  of  the 
stream  always  flowing  into  them  from  the  rural  districts :  this 
was  still  true  of  Liverpool  until  very  recently  ;  and  even  in  Lon¬ 
don,  the  mortality  is  larger,  and  the  average  duration  of  life 
shorter,  than  in  rural  districts  where  there  is  much  greater 
poverty.  In  Ireland,  epidemic  fevers,  and  deaths  from  the  ex¬ 
haustion  of  the  constitution  by  insufficient  nutriment,  have  al¬ 
ways  accompanied  even  the  most  moderate  deficiency  of  the 
potato  crop.  Nevertheless,  it  cannot  now  be  said  that  in  any 
part  of  Europe,  population  is  principally  kept  down  by  disease, 
still  less  by  starvation,  either  in  a  direct  or  in  an  indirect  form. 
The  agency  by  which  it  is  limited  is  chiefly  preventive,  not 
(in  the  language  of  Mr.  Malthus)  positive.  But  the  preventive 
remedy  seldom,  I  believe,  consists  in  the  unaided  operation  of 
prudential  motives  on  a  class  wholly  or  mainly  composed  of 
laborers  for  hire,  and  looking  forward  to  no  other  lot.  In  Eng¬ 
land,  for  example,  I  much  doubt  if  the  generality  of  agricultural 
laborers  practise  any  prudential  restraint  whatever.  They  gen¬ 
erally  marry  as  early,  and  have  as  many  children  to  a  marriage, 
as  they  would  or  could  do  if  they  were  settlers  in  the  United 
States.  During  the  generation  which  preceded  the  enactment 
of  the  present  Poor  Law,  they  received  the  most  direct  encour¬ 
agement  to  this  sort  of  improvidence :  being  not  only  assured 
of  support,  on  easy  terms,  whenever  out  of  employment,  but 
even  when  in  employment,  very  commonly  receiving  from  the 
parish  a  weekly  allowance  proportioned  to  their  number  of  chil¬ 
dren  ;  and  the  married  with  large  families  being  always,  from 
a  short-sighted  economy,  employed  in  preference  to  the  un¬ 
married  ;  which  last  premium  on  population  still  exists.  Un¬ 
der  such  prompting,  the  rural  laborers  acquired  habits  of  reck¬ 
lessness,  which  are  so  congenial  to  the  uncultivated  mind,  that 
in  whatever  manner  produced,  they  in  general  long  survive 


338 


POLITICAL  ECONOMY 


their  immediate  causes.  There  are  so  many  new  elements  at 
work  in  society,  even  in  those  deeper  strata  which  are  inacces¬ 
sible  to  the  mere  movements  on  the  surface,  that  it  is  hazardous 
to  affirm  anything  positive  on  the  mental  state  or  practical  im¬ 
pulses  of  classes  and  bodies  of  men,  when  the  same  assertion 
may  be  true  to-day,  and  may  require  great  modification  in  a 
few  years’  time.  It  does,  however,  seem,  that  if  the  rate  of  in¬ 
crease  of  population  depended  solely  on  the  agricultural  la¬ 
borers,  it  would,  as  far  as  dependent  on  births,  and  unless  re¬ 
pressed  by  deaths,  be  as  rapid  in  the  southern  counties  of 
England  as  in  America.  The  restraining  principle  lies  in  the 
very  great  proportion  of  the  population  composed  of  the  mid¬ 
dle  classes  and  the  skilled  artisans,  who  in  this  country  almost 
equal  in  number  the  common  laborers,  and  on  whom  prudential 
motives  do,  in  a  considerable  degree,  operate. 

§  4.  Where  a  laboring  class  who  have  no  property  but  their 
daily  wages,  and  no  hope  of  acquiring  it,  refrain  from  over¬ 
rapid  multiplication,  the  cause,  I  believe,  has  always  hitherto 
been,  either  actual  legal  restraint,  or  a  custom  of  some  sort 
which,  without  intention  on  their  part,  insensibly  moulds  their 
conduct,  or  affords  immediate  inducements  not  to  marry.  It 
is  not  generally  known  in  how  many  countries  of  Europe  direct 
legal  obstacles  are  opposed  to  improvident  marriages.  The 
communications  made  to  the  original  Poor  Law  Commission 
by  our  foreign  ministers  and  consuls  in  different  parts  of  Eu¬ 
rope,  contain  a  considerable  amount  of  information  on  this 
subject.  Mr.  Senior,  in  his  preface  to  those  communications,* 
says  that  in  the  countries  which  recognize  a  legal  right  to  reliet, 
“  marriage  on  the  part  of  persons  in  the  actual  receipt  of  relief 
appears  to  be  everywhere  prohibited,  and  the  marriage  of  those 
who  are  not  likely  to  possess  the  means  of  independent  support 
is  allowed  by  very  few.  Thus  we  are  told  that  in  Norway  no 
one  can  marry  without  ‘  showing,  to  the  satisfaction  of  the  cler¬ 
gyman,  that  he  is  permanently  settled  in  such  a  manner  as  to 
offer  a  fair  prospect  that  he  can  maintain  a  family/ 

“  In  Mecklenburg,  that  ‘  marriages  are  delayed  by  conscrip¬ 
tion  in  the  twenty-second  year,  and  military  service  for  six 
years  ;  besides,  the  parties  must  have  a  dwelling,  without  which 
a  clergyman  is  not  permitted  to  marry  them.  The  men  marry 

*  Forming  an  Appendix  (F)  to  the  and  also  published  by  authority  as  a 
General  Report  of  the  Commissioners,  separate  volume. 


WAGES 


339 


at  from  twenty-five  to  thirty,  the  women  not  much  earlier,  as 
both  must  first  gain  by  service  enough  to  establish  themselves.’ 

“  In  Saxony,  that  ‘  a  man  may  not  marry  before  he  is  twenty- 
one  years  old,  if  liable  to  serve  in  the  army.  In  Dresden,  pro- 
fessionists  (by  which  word  artisans  are  probably  meant)  may 
not  marry  until  they  become  masters  in  their  trade.’ 

“  In  Wurtemberg,  that  ‘  no  man  is  allowed  to  marry  till  his 
twenty-fifth  year,  on  account  of  his  military  duties,  unless  per¬ 
mission  be  especially  obtained  or  purchased :  at  that  age  he 
must  also  obtain  permission,  which  is  granted  on  proving  that 
he  and  his  wife  would  have  together  sufficient  to  maintain  a 
family  or  to  establish  themselves ;  in  large  towns,  say  from 
800  to  1000  florins  (from  £66  13s.  4d.  to  £84  3s.  4d ;)  in  smaller, 
from  400  to  500  florins  :  in  villages,  200  florins  (£16  13s.  4d.)’  ”  * 
The  minister  at  Munich  says,  “  The  great  cause  why  the 
number  of  the  poor  is  kept  so  low  in  this  country  arises  from 
the  prevention  by  law  of  marriages  in  cases  in  which  it  cannot 
be  proved  that  the  parties  have  reasonable  means  of  subsist¬ 
ence  ;  and  this  regulation  is  in  all  places  and  at  all  times  strictly 
adhered  to.  The  effect  of  a  constant  and  firm  observance  of 
this  rule  has,  it  is  true,  a  considerable  influence  in  keeping  down 
the  population  of  Bavaria,  which  is  at  present  low  for  the  ex¬ 
tent  of  country,  but  it  has  a  most  salutary  effect  in  averting 
extreme  poverty  and  consequent  misery.”  f 

At  Lubeck,  “  marriages  among  the  poor  are  delayed  by  the 
necessity  a  man  is  under,  first,  of  previously  proving  that  he  is 
in  a  regular  employ,  work,  or  profession,  that  will  enable  him 
to  maintain  a  wife :  and  secondly,  of  becoming  a  burgher,  and 
equipping  himself  in  the  uniform  of  the  burgher  guard,  which 
together  may  cost  him  nearly  £4.”  J  At  Frankfort,  “  the  gov¬ 
ernment  prescribes  no  age  for  marrying,  but  the  permission  to 
marry  is  only  granted  on  proving  a  livelihood.”  § 

The  allusion,  in  some  of  these  statements,  to  military  duties, 
points  out  an  indirect  obstacle  to  marriage,  interposed  by  the 
laws  of  some  countries  in  which  there  is  no  direct  legal  re¬ 
straint.  In  Prussia,  for  instance,  the  institutions  which  com¬ 
pel  every  able-bodied  man  to  serve  for  several  years  in  the  army, 
at  the  time  of  life  at  which  imprudent  marriages  are  most  likely 

*  Preface,  p.  xxxix.  t  Appendix,  p.  419.  §  Ibid.,  p.  567. 

t  Preface,  p.  xxxiii.,  or  p.  554  of  the 
Appendix  itself. 


340 


POLITICAL  ECONOMY 


to  take  place,  are  probably  a  full  equivalent,  in  effect  on  popu¬ 
lation,  for  the  legal  restrictions  of  the  smaller  German  states. 

“  So  strongly,”  says  Mr.  Kay,  “  do  the  people  of  Switzerland 
understand  from  experience  the  expediency  of  their  sons  and 
daughters  postponing  the  time  of  their  marriages,  that  the 
councils  of  state  of  four  or  five  of  the  most  democratic  of  the 
cantons,  elected,  be  it  remembered,  by  universal  suffrage,  have 
passed  laws  by  which  all  young  persons  who  marry  before  they 
have  proved  to  the  magistrate  of  their  district  that  they  are  able 
to  support  a  family,  are  rendered  liable  to  a  heavy  fine.  In 
Lucerne,  Argovie,  Unterwalden,  and  I  believe,  St.  Gall, 
Schweitz,  and  Uri,  laws  of  this  character  have  been  in  force  for 
many  years.”  * 

§  5.  Where  there  is  no  general  law  restrictive  of  marriage, 
there  are  often  customs  equivalent  to  it.  When  the  guilds  or 
trade  corporations  of  the  Middle  Ages  were  in  vigor,  their  by¬ 
laws  or  regulations  were  conceived  with  a  very  vigilant  eye  to 
the  advantage  which  the  trade  derived  from  limiting  competi¬ 
tion  :  and  they  made  it  very  effectually  the  interest  of  artisans 
not  to  marry  until  after  passing  through  the  two  stages  of  ap¬ 
prentice  and  journeyman,  and  attaining  the  rank  of  master. f 


*  Kay,  as  before  cited,  i.  68. 
f  “  In  general,”  says  Sismondi,  “  the 
number  of  masters  in  each  corporation 
was  fixed,  and  no  one  but  a  master  could 
keep  a  shop,  or  buy  and  sell  on  his  own 
account.  Each  master  could  only  train 
a  certain  number  of  apprentices,  whom 
he  instructed  in  his  trade;  in  some  cor¬ 
porations  he  was  only  allowed  one.  Each 
master  could  also  employ  only  a  lim¬ 
ited  number  of  workmen,  who  were 
called  companions,  or  journeymen;  and 
in  the  trades  in  which  he  could  only 
take  one  apprentice,  he  was  only  al¬ 
lowed  to  have  one,  or  at  most  two  jour¬ 
neymen.  No  one  was  allowed  to  buy, 
sell,  or  work  at  a  trade,  unless  he  was 
either  an  apprentice,  a  journeyman,  or  a 
master;  no  one  could  become  a  journey¬ 
man  without  having  served  a  given  num¬ 
ber  of  years  as  an  apprentice,  nor  a 
master,  unless  he  had  served  the  same 
number  of  years  as  a  journeyman,  and  < 
unless  he  had  also  executed  what  was 
called  his  chef  d’ceuvre  (masterpiece)  a 
piece  of  work  appointed  in  his  trade, 
and  which  was  to  be  judged  of  by  the 
corporation.  It  is  seen  that  this  organi¬ 
zation  threw  entirely  into  the  hands  of 
the  masters  the  recruiting  of  the  trade. 
They  alone  could  take  apprentices;  but 
they  were  not  compelled  to  take  any; 
accordingly  they  required  to  be  paid, 
often  at  a  very  high  rate,  for  the  favor; 
and  a  young  man  could  not  enter  into 
a  trade  if  he  had  not,  at  starting,  the 


sum  required  to  be  paid  for  his  appren¬ 
ticeship,  and  the  means  necessary  for 
his  support  during  that  apprenticeship; 
since  for  four,  five,  or  seven  years,  all 
his  work  belonged  to  his  master.  His 
dependence  on  the  master  during  that 
time  was  complete;  for  the  master’s  will, 
or  even  caprice,  could  close  the  door  of 
a  lucrative  profession  upon  him.  After 
the  apprentice  became  a  journeyman  he 
had  a  little  more  freedom;  he  could  en¬ 
gage  with  any  master  he  chose,  or  pass 
from  one  to  another;  and  as  the  condi¬ 
tion  of  a  journeyman  was  only  accessi¬ 
ble  through  apprenticeship,  he  now  be¬ 
gan  to  profit  by  the  monopoly  from 
which  he  had  previously  suffered,  and 
was  almost  sure  of  getting  well  paid  for 
a  work  which  no  one  else  was  allowed 
to  perform.  He  depended,  however,  on 
the  corporation  for  becoming  a  master, 
and  did  not,  therefore,  regard  himself  as 
being  yet  assured  of  his  lot,  or  as  hav¬ 
ing  a  permanent  position.  In  general 
he  did  not  marry  until  he  had  passed  as 
a  master. 

“  It  is  certain  both  in  fact  and  in 
theory  that  the  existence  of  trade  cor¬ 
porations  hindered,  and  could  not  but 
hinder,  the  birth  of  a  superabundant 
population.  By  the  statutes  of  almost 
all  the  guilds,  a  man  could  not  pass  as 
master  before  the  age  of  twenty-five:  but 
if  he  had  no  capital  of  his  own,  if  he 
had  not  made  sufficient  savings,  he  con¬ 
tinued  to  work  as  a  journeyman  much 


WAGES 


34i 


In  Norway,  where  the  labor  is  chiefly  agricultural,  it  is  forbid¬ 
den  to  engage  a  farm-servant  for  less  than  a  year ;  which  was 
the  general  English  practice  until  the  poor  laws  destroyed  it, 
by  enabling  the  farmer  to  cast  his  laborers  on  parish  pay  when¬ 
ever  he  did  not  immediately  require  their  labor.  In  conse¬ 
quence  of  this  custom,  and  of  its  enforcement  by  law,  the  whole 
of  the  rather  limited  class  of  agricultural  laborers  in  Norway 
have  an  engagement  for  a  year  at  least,  which  if  the  parties  are 
content  with  one  another,  naturally  becomes  a  permanent  en¬ 
gagement  :  hence  it  is  known  in  every  neighborhood  whether 
there  is,  or  is  likely  to  be,  a  vacancy,  and  unless  there  is,  a  young 
man  does  not  marry,  knowing  that  he  could  not  obtain  em¬ 
ployment.  The  custom  still  exists  in  Cumberland  and  West¬ 
moreland,  except  that  the  term  is  half  a  year  instead  of  a  year ; 
and  seems  to  be  still  attended  with  the  same  consequences. 
The  farm-servants  are  “  lodged  and  boarded  in  their  masters’ 
houses,  which  they  seldom  leave  until,  through  the  death  of 
some  relation  or  neighbor,  they  succeed  to  the  ownership  or 
lease  of  a  cottage  farm.  What  is  called  surplus  labor  does  not 
here  exist.”  *  I  have  mentioned  in  another  chapter  the  check 
to  population  in  England  during  the  last  century,  from  the 
difficulty  of  obtaining  a  separate  dwelling  place,  f  Other  cus¬ 
toms  restrictive  of  population  might  be  specified :  in  some 
parts  of  Italy,  it  is  the  practice,  according  to  Sismondi,  among 
the  poor,  as  it  is  well  known  to  be  in  the  higher  ranks,  that  all 
but  one  of  the  sons  remain  unmarried.  But  such  family  ar¬ 
rangements  are  not  likely  to  exist  among  day-laborers.  They 
are  the  resource  of  small  proprietors  and  metayers,  for  pre¬ 
venting  too  minute  a  subdivision  of  the  land. 

In  England  generally  there  is  now  scarcely  a  relic  of  these  in¬ 
direct  checks  to  population;  except  that  in  parishes  owned  by 
one  or  a  very  small  number  of  landowners,  the  increase  of  resi¬ 
dent  laborers  is  still  occasionally  obstructed,  by  preventing  cot¬ 
tages  from  being  built,  or  by  pulling  down  those  which  exist; 
thus  restraining  the  population  liable  to  become  locally  charge¬ 
able,  without  any  material  effect  on  population  generally,  the 


longer;  some,  perhaps  the  majority  of 
artisans,  remained  journeymen  all  their 
lives.  There  was,  however,  scarcely  an 
instance  of  their  marrying  before  they 
were  received  as  masters:  had  they  been 
so  imprudent  as  to  desire  it,  no  father 
would  have  given  his  daughter  to  a  man 
without  a  position.”— “  New  Principles 


of  Political  Economy,”  book  iv.,  chap. 
10.  See  also  Adam  Smith,  book  i.,  chap. 
10,  part  2. 

*  See  Thornton  on  “  Over-Popula¬ 
tion,”  page  18,  and  the  authorities  there 
cited. 

t  Supra,  p.  99. 


342 


POLITICAL  ECONOMY 


work  required  in  those  parishes  being  performed  by  laborers 
settled  elsewhere.  The  surrounding  districts  always  feel  them¬ 
selves  much  aggrieved  by  this  practice,  against  which  they  can¬ 
not  defend  themselves  by  similar  means,  since  a  single  acre  of 
land  owned  by  anyone  who  does  not  enter  into  the  combination, 
enables  him  to  defeat  the  attempt,  very  profitably  to  himself, 
by  covering  that  acre  with  cottages.  To  meet  these  complaints 
it  has  already  been  under  the  consideration  of  Parliament  to 
abolish  parochial  settlements,  and  make  the  poor  rate  a  charge 
not  on  the  parish,  but  on  the  whole  union.  If  this  proposition 
be  adopted,  which  for  other  reasons  is  very  desirable,  it  will  re¬ 
move  the  small  remnant  of  what  was  once  a  check  to  popula¬ 
tion:  the  value  of  which,  however,  from  the  narrow  limits  of  its 
operation,  must  now  be  considered  very  trifling. 

§  6.  In  the  case,  therefore,  of  the  common  agricultural  la¬ 
borer,  the  checks  to  population  may  almost  be  considered  as 
non-existent.  If  the  growth  of  the  towns,  and  of  the  capital 
there  employed,  by  which  the  factory  operatives  are  maintained 
at  their  present  average  rate  of  wages  notwithstanding  their 
rapid  increase,  did  not  also  absorb  a  great  part  of  the  annual  ad¬ 
dition  to  the  rural  population,  there  seems  no  reason  in  the 
present  habits  of  the  people  why  they  should  not  fall  into  as 
miserable  a  condition  as  the  Irish  previous  to  1846;  and  if  the 
market  for  our  manufactures  should,  I  do  not  say  fall  off,  but 
even  cease  to  expand  at  the  rapid  rate  of  the  last  fifty  years, 
there  is  no  certainty  that  this  fate  may  not  be  reserved  for  us. 
Without  carrying  our  anticipations  forward  to  such  a  calamity, 
which  the  great  and  growing  intelligence  of  the  factory  popula¬ 
tion  would,  it  may  be  hoped,  avert,  by  an  adaptation  of  their 
habits  to  their  circumstances;  the  existing  condition  of  the  la¬ 
borers  of  some  of  the  most  exclusively  agricultural  counties. 
Wiltshire,  Somersetshire,  Dorsetshire,  Bedfordshire,  Bucking¬ 
hamshire,  is  sufficiently  painful  to  contemplate.  The  laborers 
of  these  counties,  with  large  families,  and  eight  or  perhaps  nine 
shillings  for  their  weekly  wages  when  in  full  employment,  have 
for  some  time  been  one  of  the  stock  objects  of  popular  com¬ 
passion:  it  is  time  that  they  had  the  benefit  also  of  some  applica¬ 
tion  of  common  sense. 

Unhappily,  sentimentality  rather  than  common  sense  usually 
presides  over  the  discussion  of  these  subjects;  and  while  there 
is  a  growing  sensitiveness  to  the  hardships  of  the  poor,  and  a 


WAGES 


343 


ready  disposition  to  admit  claims  in  them  upon  the  good  offices 
of  other  people,  there  is  an  all  but  universal  unwillingness  to 
face  the  real  difficulty  of  their  position,  or  advert  at  all  to  the 
conditions  which  nature  has  made  indispensable  to  the  improve¬ 
ment  of  their  physical  lot.  Discussions  on  the  condition  of  the 
laborers,  lamentations  over  its  wretchedness,  denunciations  of 
all  who  are  supposed  to  be  indifferent  to  it,  projects  of  one  kind 
or  another  for  improving  it,  were  in  no  country  and  in  no  time 
of  the  world  so  rife  as  in  the  present  generation;  but  there  is  a 
tacit  agreement  to  ignore  totally  the  law  of  wages,  or  to  dismiss 
it  in  a  parenthesis,  with  such  terms  as  “  hard-hearted  Mal¬ 
thusianism;  ”  as  if  it  were  not  a  thousand  times  more  hard-heart¬ 
ed  to  tell  human  beings  that  they  may,  than  that  they  may  not, 
call  into  existence  swarms  of  creatures  who  are  sure  to  be  mis¬ 
erable,  and  most  likely  to  be  depraved;  and  forgetting  that  the 
conduct,  which  it  is  reckoned  so  cruel  to  disapprove,  is  a  degrad¬ 
ing  slavery  to  a  brute  instinct  in  one  of  the  persons  concerned, 
and  most  commonly,  in  the  other,  helpless  submission  to  a  re¬ 
volting  abuse  of  power. 

So  long  as  mankind  remained  in  a  semi-barbarous  state,  with 
the  indolence  and  the  few  wants  of  the  savage,  it  probably  was 
not  desirable  that  population  should  be  restrained :  the  pressure  of 
physical  want  may  have  been  a  necessary  stimulus,  in  that  stage 
of  the  human  mind,  to  the  exertion  of  labor  and  ingenuity  re¬ 
quired  for  accomplishing  that  greatest  of  all  past  changes  in  hu¬ 
man  modes  of  existence,  by  which  industrial  life  attained  pre¬ 
dominance  over  the  hunting,  the  pastoral,  and  the  military  or 
predatory  state.  Want,  in  that  age  of  the  world,  had  its  uses, 
as  even  slavery  had;  and  there  may  be  corners  of  the  earth 
where  those  uses  are  not  yet  superseded,  though  they  might 
easily  be  so  were  a  helping  hand  held  out  by  more  civilized  com¬ 
munities.  But  in  Europe  the  time,  if  it  ever  existed,  is  long 
past,  when  a  life  of  privation  had  the  smallest  tendency  to  make 
men  either  better  workmen  or  more  civilized  beings.  It  is,  on 
the  contrary,  evident,  that  if  the  agricultural  laborers  were  bet¬ 
ter  off,  they  would  both  work  more  efficiently,  and  be  better 
citizens.  I  ask,  then,  is  it  true,  or  not,  that  if  their  numbers  were 
fewer  they  would  obtain  higher  wages?  This  is  the  question, 
and  no  other:  and  it  is  idle  to  divert  attention  from  it,  by  at¬ 
tacking  any  incidental  position  of  Malthus  or  some  other  writer, 
and  pretending  that  to  refute  that,  is  to  disprove  the  principle  of 


344 


POLITICAL  ECONOMY 


population.  Some,  for  instance,  have  achieved  an  easy  victory 
over  a  passing  remark  of  Mr.  Malthus,  hazarded  chiefly  by  way 
of  illustration,  that  the  increase  of  food  may  perhaps  be  assumed 
to  take  place  in  an  arithmetical  ratio,  while  population  increases 
in  a  geometrical:  when  every  candid  reader  knows  that  Mr. 
Malthus  laid  no  stress  on  this  unlucky  attempt  to  give  numerical 
precision  to  things  which  do  not  admit  of  it,  and  every  person 
capable  of  reasoning  must  see  that  it  is  wholly  superfluous  to  his 
argument.  Others  have  attached  immense  importance  to  a  cor¬ 
rection  which  more  recent  political  economists  have  made  in  the 
mere  language  of  the  earlier  followers  of  Mr.  Malthus.  Several 
writers  have  said  that  it  is  the  tendency  of  population  to  increase 
faster  than  the  means  of  subsistence.  The  assertion  was  true  in 
the  sense  in  which  they  meant  it,  namely  that  population  would 
in  most  circumstances  increase  faster  than  the  means  of  subsist¬ 
ence,  if  it  were  not  checked  either  by  mortality  or  by  prudence. 
But  inasmuch  as  these  checks  act  with  unequal  force  at  dif¬ 
ferent  times  and  places,  it  was  possible  to  interpret  the  language 
of  these  writers  as  if  they  had  meant  that  population  is  usually 
gaining  ground  upon  subsistence,  and  the  poverty  of  the  people 
becoming  greater.  Under  this  interpretation  of  their  meaning, 
it  was  urged  that  the  reverse  is  the  truth :  that  as  civilization  ad¬ 
vances,  the  prudential  check  tends  to  become  stronger  and  pop¬ 
ulation  to  slacken  its  rate  of  increase,  relatively  to  subsistence ; 
and  that  it  is  an  error  to  maintain  that  population,  in  any  im¬ 
proving  community,  tends  to  increase  faster  than,  or  even  so 
fast  as  subsistence.  The  word  tendency  is  here  used  in  a  totally 
different  sense  from  that  of  the  writers  who  affirmed  the  propo¬ 
sition:  but  waiving  the  verbal  question,  is  it  not  allowed  on 
both  sides,  that  in  old  countries,  population  presses  too  closely 
upon  the  means  of  subsistence?  And  though  its  pressure  di¬ 
minishes,  the  more  the  ideas  and  habits  of  the  poorest  class  of 
laborers  can  be  improved,  to  which  it  is  to  be  hoped  that  there  is 
always  some  tendency  in  a  progressive  country,  yet  since  that 
tendency  has  hitherto  been,  and  still  is,  extremely  faint,  and  (to 
descend  to  particulars)  has  not  yet  extended  to  giving  to  the 
Wiltshire  laborers  higher  wages  than  eight  shilllings  a  week,  the 
only  thing  which  it  is  necessary  to  consider  is,  whether  that  is 
a  sufficient  and  suitable  provision  for  a  laborer?  for  if  not,  popu¬ 
lation  does,  as  an  existing  fact,  bear  too  great  a  proportion  to  the 
wages  fund;  and  whether  it  pressed  still  harder  or  not  quite  so 


POPULAR  REMEDIES  FOR  LOW  WAGES 


345 


hard  at  some  former  period,  is  practically  of  no  moment,  except 
that,  if  the  ratio  is  an  improving  one,  there  is  the  better  hope 
that  by  proper  aids  and  encouragements  it  may  be  made  to  im¬ 
prove  more  and  faster. 

It  is  not,  however,  against  reason,  that  the  argument  on  this 
subject  has  to  struggle;  but  against  a  feeling  of  dislike,  which 
will  only  reconcile  itself  to  the  unwelcome  truth,  when  every 
device  is  exhausted  by  which  the  recognition  of  that  truth  can 
be  evaded.  It  is  necessary,  therefore,  to  enter  into  a  detailed  ex¬ 
amination  of  these  devices,  and  to  force  every  position  which  is 
taken  up  by  the  enemies  of  the  population  principle,  in  their  de¬ 
termination  to  find  some  refuge  for  the  laborers,  some  plausible 
means  of  improving  their  condition,  without  requiring  the  ex¬ 
ercise,  either  enforced  or  voluntary,  of  any  self-restraint,  or  any 
greater  control  than  at  present  over  the  animal  power  of  multi¬ 
plication.  This  will  be  the  object  of  the  next  chapter. 


Chapter  XII. — Of  Popular  Remedies  for  Low  Wages 

§  i.  The  simplest  expedient  which  can  be  imagined  for  keep¬ 
ing  the  wages  of  labor  up  to  the  desirable  point,  would  be  to  fix 
them  by  law:  and  this  is  virtually  the  object  aimed  at  in  a  variety 
of  plans  which  have  at  different  times  been,  or  still  are,  current, 
for  remodelling  the  relation  between  laborers  and  employers. 
No  one  probably  ever  suggested  that  wages  should  be  absolutely 
fixed;  since  the  interests  of  all  concerned,  often  require  that  they 
should  be  variable;  but  some  have  proposed  to  fix  a  minimum 
of  wages,  leaving  the  variations  above  that  point  to  be  adjusted 
by  competition.  ^Another  plan,  which  has  found  many  advocates 
among  the  leaders  of  the  operatives,  is  that  councils  should  be 
formed,  which  in  England  have  beencalled  local  boards  of 
le,  in  France  “  conseils  de  prud\ommes !’  and  other  names : 


consisting  of  delegates  from  the  workpeople  and  from  the  em¬ 
ployers,  who,  meeting  in  conference,  should  agree  upon  a  rate 
TTf'lvages.  a-ntl  brortltllgat'e  it  from  autnontv.  to  be  binding  gen¬ 
erally  on  employers  and  workmen;  the  ground  of  decision  be- 
Ing,  not  the  state  of  the  labor-market,  but  natural  equity:  to 
provide  that  the  workmen  shall  have  reasonable  wages,  and  the 
capitalists  reasonable  profits. 

Others  again  (but  these  are  rather  philanthropists  interesting 
themselves  for  the  laboring  classes,  than  the  laboring  people 


346 


POLITICAL  ECONOMY 


themselves)  are  shy  of  admitting  the  interference  of  authority 
in  contracts  for  labor:  they  fear  that  if  law  intervened,  it  would 
intervene  rashly  and  ignorantly;  they  are  convinced  that  two 
parties,  with  opposite  interests,  attempting  to  adjust  those  in¬ 
terests  by  negotiation  through  their  representatives  on  principles 
of  equity,  when  no  rule  could  be  laid  down  to  determine  what 
was  equitable,  would  merely  exasperate  their  differences  instead 
of  healing  them;  but  what  it  is  useless  to  attempt  by  the  legal 
sanction,  these  persons  desire  to  compass  by  the  moral.  Every 
employer,  they  think,  ought  to  give  sufficient  wages ;  and  if  he 
does  it  not  willingly,  should  be  compelled  to  it  by  general  opin¬ 
ion;  the  test  of  sufficient  wages  being  their  own  feelings,  or 
what  they  suppose  to  be  those  of  the  public.  This  is,  I  think,  a 
fair  representation  of  a  considerable  body  of  existing  opinion  on 
the  subject. 

I  desire  to  confine  my  remarks  to  the  principle  involved  in  all 
these  suggestions,  without  taking  into  account  practical  diffi¬ 
culties,  serious  as  these  must  at  once  be  seen  to  be.  I  shall  sup¬ 
pose  that  by  one  or  other  of  these  contrivances,  wages  could  be 
kept  above  the  point  to  which  they  would  be  brought  by  com¬ 
petition.  This  is  as  much  as  to  say,  above  the  highest  rate  which 
can  be  afforded  by  the  existing  capital  consistently  with  em¬ 
ploying  all  the  laborers.  For  it  is  a  mistake  to  suppose  that 
competition  merely  keeps  down  wages.  It  is  equally  the  means 
by  which  they  are  kept  up.  When  there  are  any  laborers  un¬ 
employed,  these,  unless  maintained  by  charity,  become  com¬ 
petitors  for  hire,  and  wages  fall;  but  when  all  who  were  out  of 
work  have  found  employment,  wages  will  not,  under  the  freest 
system  of  competition,  fall  lower.  There  are  strange  notions 
afloat  concerning  the  nature  of  competition.  Some  people  seem 
to  imagine  that  its  effect  is  something  indefinite;  that  the  com¬ 
petition  of  sellers  may  lower  prices,  and  the  competition 
of  laborers  may  lower  wages  down  to  zero,  or  some  un¬ 
assignable  minimum.  Nothing  can  be  more  unfounded. 
Goods  can  only  be  lowered  in  price  by  competition,  to  the  point 
which  calls  forth  buyers  sufficient  to  take  them  off;  and  wages 
can  only  be  lowered  by  competition  until  room  is  made  to  admit 
all  the  laborers  to  a  share  in  the  distribution  of  the  wages-fund. 
If  they  fell  below  this  point,  a  portion  of  capital  would  remain 
unemployed  for  want  of  laborers;  a  counter-competition  would 
commence  on  the  side  of  capitalists,  and  wages  would  rise. 


POPULAR  REMEDIES  FOR  LOW  WAGES 


347 


Since,  therefore,  the  rate  of  wages  which  results  from  compe- 
tition  distributes  the  whole  wages-fund  among  the  whole  labor- 
mg  population ;  if  law  or  opinion  succeeds  in  fixing  wages  above 
this  rate,  some  laborers  are  kept  out  of  employment;  and  as  it 
is  not  the  intention  of  the  philanthropists  that  these  should  starve, 
they  must  be  provided  for  by  a  forced  increase  of  the  wages- 
fund;  by  a  compulsory  saving.  It  is  nothing  to  fix  a  minimum 
of  wages,  unless  there  be  a  provision  that  work,  or  wages  at 
least,  be  found  for  all  who  apply  for  it.  This,  accordingly,  is  al¬ 
ways  part  of  the  scheme;  and  is  consistent  with  the  ideas  of 
more  people  than  would  approve  of  either  a  legal  or  a  moral 
minimum  of  wages.  Popular  sentiment  looks  upon  it  as  the 
(jutv  of  the  rich,  or  of  the  stateT  to  find  employment  for  all  the 
poor^  If  the  moral  influence  of  opinion  does  not  induce  the  rich 
to  spare  from  their  consumption  enough  to  set  all  the  poor  to 
work  at  “  reasonable  wages,”  it  is  supposed  to  be  incumbent  on 
the  state  to  lay  on  taxes  for  the  purpose,  either  by  local  rates  or 
votes  of  public  money.  The  proportion  between  labor  and  the 
wages-fund  would  thus  be  modified  to  the  advantage  of  the  la¬ 
borers,  not  by  restriction  of  population,  but  by  an  increase  of 
capital. 

§  2.  If  this  claim  on  society  could  be  limited  to  the  existing 
generation;  if  nothing  more  were  necessary  than  a  compulsory 
accumulation,  sufficient  to  provide  permanent  employment  at 
ample  wages  for  the  existing  numbers  of  the  people;  such  a 
proposition  would  have  no  more  strenuous  supporter  than  my¬ 
self.  Society  mainly  consists  of  those  who  live  by  bodily  labor; 
and  if  society,  that  is,  if  the  laborers,  lend  their  physical  force  to 
protect  individuals  in  the  enjoyment  of  superfluities,  they  are 
entitled  to  do  so,  and  have  always  done  so,  with  the  reservation 
of  a  power  to  tax  those  superfluities  for  purposes  of  public  util¬ 
ity;  among  which  purposes  the  subsistence  of  the  people  is  the 
foremost.  Since  no  one  is  responsible  for  having  been  born,  no 
pecuniary  sacrifice  is  too  great  to  be  made  by  those  who  have 
more  than  enough,  for  the  purpose  of  securing  enough  to  all 
persons  already  in  existence. 

But  it  is  another  thing  altogether,  when  those  who  have  pro¬ 
duced  and  accumulated  are  called  upon  to  abstain  from  con¬ 
suming,  until  they  have  given  food  and  clothing,  not  only  to  all 
who  now  exist,  but  to  all  whom  these  or  their  descendants  may 
think  fit  to  call  into  existence.  Such  an  obligation  acknowl- 


348 


POLITICAL  ECONOMY 


edged  and  acted  upon,  would  suspend  all  checks,  both  positive 
and  preventive;  there  would  be  nothing  to  hinder  population 
from  starting  forward  at  its  rapidest  rate;  and  as  the  natural 
increase  of  capital  would,  at  the  best,  not  be  more  rapid  than 
before,  taxation,  to  make  up  the  growing  deficiency,  must  ad¬ 
vance  with  the  same  gigantic  strides.  The  attempt  would  of 
course  be  made  to  exact  labor  in  exchange  for  support.  But 
experience  has  shown  the  sort  of  work  to  be  expected  from 
recipients  of  public  charity.  When  the  pay  it  not  given  for  the 
sake  of  the  work,  but  the  work  found  for  the  sake  of  the  pay,  in¬ 
efficiency  is  a  matter  of  certainty:  to  extract  real  work  from 
day-laborers  without  the  power  of  dismissal,  is  only  practicable 
by  the  power  of  the  lash.  It  is  conceivable,  doubtless,  that  this 
objection  might  be  got  over.  The  fund  raised  by  taxation  might 
be  spread  over  the  labor-market  generally,  as  seems  to  be  in¬ 
tended  by  the  supporters  of  the  “  right  to  employment  ”  in 
France;  without  giving  to  any  unemployed  laborer  a  right  to 
demand  support  in  a  particular  place  or  from  a  particular  func¬ 
tionary.  The  power  of  dismissal,  as  regards  individual  laborers, 
would  then  remain;  the  government  only  undertaking  to  create 
additional  employment  when  there  was  a  deficiency,  and  reserv¬ 
ing,  like  other  employers,  the  choice  of  its  own  workpeople. 
But  let  them  work  ever  so  efficiently,  the  increasing  population 
could  not,  as  we  have  so  often  shown,  increase  the  produce  pro¬ 
portionally:  the  surplus,  after  all  were  fed,  would  bear  a  less 
and  less  proportion  to  the  whole  produce  and  to  the  population : 
and  the  increase  of  people  going  on  in  a  constant  ratio,  while 
the  increase  of  produce  went  on  in  a  diminishing  ratio,  the  sur¬ 
plus  would  in  time  be  wholly  absorbed ;  taxation  for  the  support 
of  the  poor  would  engross  the  whole  income  of  the  country;  the 
payers  and  the  receivers  would  be  melted  down  into  one  mass. 
The  check  to  population  either  by  death  or  prudence,  could  not 
then  be  staved  off  any  longer,  but  must  come  into  operation  sud¬ 
denly  and  at  once;  everything  which  places  mankind  above  a 
nest  of  ants  or  colony  of  beavers,  having  perished  in  the  interval. 

These  consequences  have  been  so  often  and  so  clearly  pointed 
out  by  authors  of  reputation,  in  writings  known  and  accessible, 
that  ignorance  of  them  on  the  part  of  educated  persons  is  no 
longer  pardonable.  It  is  doubly  discreditable  in  any  person  set¬ 
ting  up  for  a  public  teacher,  to  ignore  these  considerations;  to 
dismiss  them  silently,  and  discuss  or  declaim  on  wages  and  poor- 


POPULAR  REMEDIES  FOR  LOW  WAGES 


349 


laws,  not  as  if  these  arguments  could  be  refuted,  but  as  if  they 
did  not  exist. 

Everyone  has  a  right  to  live.  We  will  suppose  this  granted. 
But  no  one  has  a  right  to  bring  creatures  into  life,  to  be  sup¬ 
ported  by  other  people.  Whoever  means  to  stand  upon  the 
first  of  these  rights  must  renounce  all  pretension  to  the  last.  If 
a  man  cannot  support  even  himself  unless  others  help  him,  those 
others  are  entitled  to  say  that  they  do  not  also  undertake  the 
support  of  any  offspring  which  it  is  physically  possible  for  him 
to  summon  into  the  world.  Yet  there  are  abundance  of  writers 
and  public  speakers,  including  many  of  most  ostentatious  pre¬ 
tensions  to  high  feeling,  whose  views  of  life  are  so  truly  brutish, 
that  they  see  hardship  in  preventing  paupers  from  breeding 
hereditary  paupers  in  the  workhouse  itself.  Posterity  will  one 
day  ask  with  astonishment,  what  sort  of  people  it  could  be 
among  whom  such  preachers  could  find  proselytes. 

It  would  be  possible  for  the  state  to  guarantee  employment 
at  ample  wages  to  all  who  are  born.  But  if  it  does  this,  it  is 
bound  in  self-protection,  and  for  the  sake  of  every  purpose  for 
which  government  exists,  to  provide  that  no  person  shall  be  born 
without  its  consent.  If  the  ordinary  and  spontaneous  motives 
to  self-restraint  are  removed,  others  must  be  substituted.  Re¬ 
strictions  on  marriage,  at  least  equivalent  to  those  existing  in 
some  of  the  German  States,  or  severe  penalties  on  those  who 
have  children  when  unable  to  support  them,  would  then  be  in¬ 
dispensable.  Society  can  feed  the  necessitous,  if  it  takes  their 
multiplication  under  its  control;  or  (if  destitute  of  all  moral  feel¬ 
ing  for  the  wretched  offspring)  it  can  leave  the  last  to  their  dis¬ 
cretion,  abandoning  the  first  to  their  own  care.  But  it  cannot 
with  impunity  take  the  feeding  upon  itself,  and  leave  the  multi¬ 
plying  free. 

To  give  profusely  to  the  people,  whether  under  the  name  of 
charity  or  of  employment,  without  placing  them  under  such  in¬ 
fluences  that  prudential  motives  shall  act  powerfully  upon  them, 
is  to  lavish  the  means  of  benefiting  mankind,  without  attaining 
the  object.  Leave  the  people  in  a  situation  in  which  their  condi¬ 
tion  manifestly  depends  upon  their  numbers,  and  the  greatest 
permanent  benefit  may  be  derived  from  any  sacrifice  made  to 
improve  the  physical  well-being  of  the  present  generation,  and 
raise,  by  that  means,  the  habits  of  their  children.  But  remove 
the  regulation  of  their  wages  from  their  own  control;  guarantee 


350 


POLITICAL  ECONOMY 


to  them  a  certain  payment,  either  by  law,  or  by  the  feeling  of  the 
community ;  and  no  amount  of  comfort  that  you  can  give  them 
will  make  either  them  or  their  descendants  look  to  their  own 
self-restraint  as  the  proper  means  for  preserving  them  in  that 
state.  You  will  only  make  them  indignantly  claim  the  continu¬ 
ance  of  your  guarantee,  to  themselves  and  their  full  complement 
of  possible  posterity. 

On  these  grounds  some  writers  have  altogether  condemned 
the  English  poor-law,  and  any  system  of  relief  to  the  able-bodied, 
at  least  when  uncombined  with  systematic  legal  precautions 
against  over-population.  The  famous  Act  of  the  43d  of  Eliza¬ 
beth  undertook,  on  the  part  of  the  public,  to  provide  work  and 
wages  for  all  the  destitute  able-bodied:  and  there  is  little  doubt 
that  if  the  intent  of  that  Act  had  been  fully  carried  out,  and  no 
means  had  been  adopted  by  the  administrators  of  relief  to  neu¬ 
tralize  its  natural  tendencies,  the  poor-rate  would  by  this  time 
have  absorbed  the  whole  net  produce  of  the  land  and  labor  of 
the  country.  It  is  not  at  all  surprising,  therefore,  that  Mr.  Mal- 
thus  and  others  should  at  first  have  concluded  against  all  poor- 
laws  whatever.  It  required  much  experience,  and  careful  ex¬ 
amination  of  different  modes  of  poor-law  management,  to  give 
assurance  that  the  admission  of  an  absolute  right  to  be  supported 
at  the  cost  of  other  people,  could  exist  in  law  and  in  fact,  without 
fatally  relaxing  the  springs  of  industry  and  the  restraints  of  pru¬ 
dence.  This,  however,  was  fully  substantiated,  by  the  investiga¬ 
tions  of  the  original  Poor  Law  Commissioners.  Hostile  as  they 
are  unjustly  accused  of  being  to  the  principle  of  legal  relief,  they 
are  the  first  who  fully  proved  the  compatibility  of  any  Poor  Law 
in  which  a  right  to  relief  was  recognized,  with  the  permanent  in¬ 
terests  of  the  laboring  class  and  of  posterity.  By  a  collection  of 
facts,  experimentally  ascertained  in  parishes  scattered  through¬ 
out  England,  it  was  shown  that  the  guarantee  of  support  could 
be  freed  from  its  injurious  effects  upon  the  minds  and  habits  of 
the  people,  if  the  relief,  though  ample  in  respect  to  necessaries, 
was  accompanied  with  conditions  which  they  disliked,  consist¬ 
ing  of  some  restraints  on  their  freedom,  and  the  privation  of 
some  indulgences.  Under  this  proviso,  it  may  be  regarded  as 
irrevocably  established,  that  the  fate  of  no  member  of  the  com¬ 
munity  needs  be  abandoned  to  chance;  that  society  can,  and 
therefore  ought  to  insure  every  individual  belonging  to  it  against 
the  extreme  of  want;  that  the  condition  even  of  those  who  are 


POPULAR  REMEDIES  FOR  LOW  WAGES 


35i 


unable  to  find  their  own  support,  needs  not  be  one  of  physical 
suffering,  or  the  dread  of  it,  but  only  of  restricted  indulgence, 
and  enforced  rigidity  of  discipline.  This  is  surely  something 
gained  for  humanity,  important  in  itself,  and  still  more  so  as  a 
step  to  something  beyond;  and  humanity  has  no  worse  enemies 
than  those  who  lend  themselves,  either  knowingly  or  uninten¬ 
tionally,  to  bring  odium  on  this  law,  or  on  the  principles  in 
which  it  originated. 

§  3.  Next  to  the  attempts  to  regulate  wages,  and  provide  arti¬ 
ficially  that  all  who  are  willing  to  work  shall  receive  an  adequate 
price  for  their  labor,  we  have  to  consider  another  class  of  popu¬ 
lar  remedies,  which  do  not  profess  to  interfere  with  freedom  of 
contract;  which  leave  wages  to  be  fixed  by  the  competition  of 
the  market,  but,  when  they  are  considered  insufficient,  endeavor 
by  some  subsidiary  resource  to  make  up  to  the  laborers  for  the 
insufficiency.  Of  this  nature  was  the  expedient  resorted  to  by 
parish  authorities  during  thirty  or  forty  years  previous  to  1834, 
generally  known  as  the  Allowance  System.  This  was  first  intro¬ 
duced,  when  through  a  succession  of  bad  seasons,  and  conse¬ 
quent  high  prices  of  food,  the  wages  of  labor  had  become  inade¬ 
quate  to  afford  to  the  families  of  the  agricultural  laborers  the 
amount  of  support  to  which  they  had  been  accustomed.  Senti¬ 
ments  of  humanity,  joined  with  the  idea  then  inculcated  in  high 
quarters,  that  people  ought  not  to  be  allowed  to  suffer  for  hav¬ 
ing  enriched  their  country  with  a  multitude  of  inhabitants,  in¬ 
duced  the  magistrates  of  the  rural  districts  to  commence  giving 
parish  relief  to  persons  already  in  private  employment;  and 
when  the  practice  had  once  been  sanctioned,  the  immediate  in¬ 
terest  of  the  farmers,  whom  it  enabled  to  throw  part  of  the 
support  of  their  laborers  upon  the  other  inhabitants  of  the  par¬ 
ish,  led  to  a  great  and  rapid  extension  of  it.  The  principle  of 
this  scheme  being  avowedly  that  of  adapting  the  means  of  every 
family  to  its  necessities,  it  was  a  natural  consequence  that  more 
should  be  given  to  the  married  than  to  the  single,  and  to  those 
who  had  large  families  than  to  those  who  had  not:  in  fact,  an 
allowance  was  usually  granted  for  every  child.  So  direct  and 
positive  an  encouragement  to  population  is  not,  however,  in¬ 
separable  from  the  scheme:  the  allowance  in  aid  of  wages  might 
be  a  fixed  thing,  given  to  all  laborers  alike,  and  as  this  is  the 
least  objectionable  form  which  the  system  can  assume,  we  will 
give  it  the  benefit  of  the  supposition. 


POLITICAL  ECONOMY 


352 

It  is  obvious  that  this  is  merely  another  mode  of  fixing  a  min¬ 
imum  of  wages;  no  otherwise  differing  from  the  direct  mode, 
than  in  allowing  the  employer  to  buy  the  labor  at  its  market 
price,  the  difference  being  made  up  to  the  laborer  from  a  public 
fund.  The  one  kind  of  guarantee  is  open  to  all  the  objections 
which  have  been  urged  against  the  other.  It  promises  to  the 
laborers  that  they  shall  all  have  a  certain  amount  of  wages,  how¬ 
ever  numerous  they  may  be:  and  removes,  therefore,  alike  the 
positive  and  the  prudential  obstacles  to  an  unlimited  increase. 
But  besides  the  objections  common  to  all  attempts  to  regulate 
wages  without  regulating  population,  the  allowance  system  has 
a  peculiar  absurdity  of  its  own.  This  is,  that  it  inevitably  takes 
from  wages  with  one  hand  what  it  adds  to  them  with  the  other. 
There  is  a  rate  of  wages,  either  the  lowest  on  which  the  people 
can,  or  the  lowest  on  which  they  will  consent,  to  live.  We  will 
suppose  this  to  be  seven  shillings  a  week.  Shocked  at  the 
wretchedness  of  this  pittance,  the  parish  authorities  humanely 
make  it  up  to  ten.  But  the  laborers  are  accustomed  to  seven,  and 
though  they  would  gladly  have  more,  will  live  on  that  (as  the 
fact  proves)  rather  than  restrain  the  instinct  of  multiplication. 
Their  habits  will  not  be  altered  for  the  better  by  giving  them 
parish  pay.  Receiving  three  shillings  from  the  parish,  they  will 
be  as  well  off  as  before  though  they  should  increase  sufficiently 
to  bring  down  wages  to  four  shillings.  They  will  accordingly 
people  down  to  that  point;  or  perhaps,  without  waiting  for  an 
increase  of  numbers,  there  are  unemployed  laborers  enough  in 
the  workhouse  to  produce  the  effect  at  once.  It  is  well  known 
that  the  allowance  system  did  practically  operate  in  the  mode 
described,  and  that  under  its  influence  wages  sank  to  a  lower 
rate  than  had  been  known  in  England  before.  During  the  last 
century,  under  a  rather  rigid  administration  of  the  poor-laws, 
population  increased  slowly,  and  agricultural  wages  were  con¬ 
siderably  above  the  starvation  point.  Under  the  allowance  sys¬ 
tem  the  people  increased  so  fast,  and  wages  sank  so  low,  that 
with  wages  and  allowance  together,  families  were  worse  off  than 
they  had  been  before  with  wages  alone.  When  the  laborer  de¬ 
pends  solely  on  wages,  there  is  a  virtual  minimum.  If  wages 
fall  below  the  lowest  rate  which  will  enable  the  population  to 
be  kept  up,  depopulation  at  least  restores  them  to  that  lowest 
rate.  But  if  the  deficiency  is  to  be  made  up  by  a  forced  con¬ 
tribution  from  all  who  have  anything  to  give,  wages  may  fall 


POPULAR  REMEDIES  FOR  LOW  WAGES 


353 


below  starvation  point;  they  may  fall  almost  to  zero.  This  de¬ 
plorable  system,  worse  than  any  other  form  of  poor-law  abuse 
yet  invented,  inasmuch  as  it  pauperizes  not  merely  the  unem¬ 
ployed  part  of  the  population  but  the  whole,  has  been  abolished, 
and  of  this  one  abuse  at  least  it  may  be  said  that  nobody  professes 
to  wish  for  its  revival. 

§  4.  But  while  this  is  (it  is  to  be  hoped)  exploded,  there  is 
another  mode  of  relief  in  aid  of  wages,  which  is  still  highly  popu¬ 
lar;  a  mode  greatly  preferable,  morally  and  socially,  to  parish 
allowance,  but  tending,  it  is  to  be  feared,  to  a  very  similar  eco¬ 
nomical  result:  I  mean  the  much-boasted  Allotment  System. 
This,  too,  is  a  contrivance  to  compensate  the  laborer  for  the 
insufficiency  of  his  wages,  by  giving  him  something  else  as  a 
supplement  to  them :  but  instead  of  having  them  made  up  from 
the  poor-rate,  he  is  enabled  to  make  them  up  for  himself,  by 
renting  a  small  piece  of  ground,  which  he  cultivates  like  a  garden 
by  spade  labor,  raising  potatoes  and  other  vegetables  for  home 
consumption,  with  perhaps  some  additional  quantity  for  sale. 
If  he  hires  the  ground  ready  manured,  he  sometimes  pays  for  it 
at  as  high  a  rate  as  £8  an  £cre :  but  getting  his  own  labor 
and  that  of  his  family  for  nothing,  he  is  able  to  gain  several 
pounds  by  it  even  at  so  high  a  rent.*  The  patrons  of  the  system 
make  it  a  great  point  that  the  allotment  shall  be  in  aid  of  wages, 
and  not  a  substitute  for  them ;  that  it  shall  not  be  such  as  a  la¬ 
borer  can  live  on,  but  only  sufficient  to  occupy  the  spare  hours 
and  days  of  a  man  in  tolerably  regular  agricultural  employment, 
with  assistance  from  his  wife  and  children.  They  usually  limit 
the  extent  of  a  single  allotment  to  a  quarter,  or  something  be¬ 
tween  a  quarter  and  half  an  acre.  If  it  exceeds  this,  without 
being  enough  to  occupy  him  entirely,  it  will  make  him,  they  say, 
a  bad  and  uncertain  workman  for  hire:  if  it  is  sufficient  to  take 
him  entirely  out  of  the  class  of  hired  laborers,  and  to  become 
his  sole  means  of  subsistence,  it  will  make  him  an  Irish  cottier: 
for  which  assertion,  at  the  enormous  rents  usually  demanded, 
there  is  some  foundation.  But  in  their  precautions  against  cot- 
tierism,  these  well-meaning  persons  do  not  perceive,  that  if  the 
system  they  patronize  is  not  a  cottier  system,  it  is,  in  essentials, 
neither  more  nor  less  than  a  system  of  conacre. 

There  is  no  doubt  a  material  difference  between  eking  out  in- 

*  See  the  Evidence  on  the  subject  of  Allotments,  collected  by  the  Commis-' 
sioners  of  Poor  Law  Inquiry. 

VOL.  I. — 23 


354 


POLITICAL  ECONOMY 


sufficient  wages  by  a  fund  raised  by  taxation,  and  doing  the 
same  thing  by  means  which  make  a  clear  addition  to  the  gross 
produce  of  the  country.  There  is  also  a  difference  between 
helping  a  laborer  by  means  of  his  own  industry,  and  subsidizing 
him  in  a  mode  which  tends  to  make  him  careless  and  idle.  On 
both  these  points,  allotments  have  an  unquestionable  advantage 
over  parish  allowances.  But  in  their  effect  on  wages  and  popu¬ 
lation,  I  see  no  reason  why  the  two  plans  should  substantially 
differ.  All  subsidies  in  aid  of  wages  enable  the  laborer  to  do 
with  less  remuneration,  and  therefore  ultimately  bring  down  the 
price  of  labor  by  the  full  amount,  unless  a  change  be  wrought  in 
the  ideas  and  requirements  of  the  laboring  class;  an  alteration 
in  the  relative  value  which  they  set  upon  the  gratification  of  their 
instincts,  and  upon  the  increase  of  their  comforts  and  the  com¬ 
forts  of  those  connected  with  them.  That  any  such  change  in 
their  character  should  be  produced  by  the  allotment  system, 
appears  to  me  a  thing  not  to  be  expected.  The  possession  of 
land,  we  are  sometimes  told,  renders  the  laborer  provident. 
Property  in  land  does  so;  or  what  is  equiyalent  to  property,  oc¬ 
cupation  on  fixed  terms  and  on  a  permanent  tenure.  But  mere 
hiring  from  year  to  year  was  never  found  to  have  any  such 
effect.  Did  possession  of  land  render  the  Irishmen  provident? 
Testimonies,  it  is  true,  abound,  and  I  do  not  seek  to  discredit 
them,  of  the  beneficial  change  produced  in  the  conduct  and  con¬ 
dition  of  laborers,  by  receiving  allotments.  Such  an  effect  is  to 
be  expected  while  those  who  hold  them  are  a  small  number;  a 
privileged  class,  having  a  status  above  the  common  level,  which 
they  are  unwilling  to  lose.  They  are  also,  no  doubt,  almost  al¬ 
ways,  originally  a  select  class,  composed  of  the  most  favorable 
speciments  of  the  laboring  people:  which,  however,  is  attented 
with  the  inconvenience  that  the  persons  to  whom  the  system 
facilitates  marrying  and  having  children,  are  precisely  those 
who  would  otherwise  be  the  most  likely  to  practice  prudential 
restraint.  As  affecting  the  general  condition  of  the  laboring 
class,  the  scheme,  as  it  seems  to  me,  must  be  either  nugatory 
or  mischievous.  If  only  a  few  laborers  have  allotments,  they 
are  naturally  those  who  could  do  best  without  them,  and  no  good 
is  done  to  the  class:  while,  if  the  system  were  general,  and  every 
or  almost  every  laborer  had  an  allotment,  I  believe  the  effect 
would  be  much  the  same  as  when  every  or  almost  every  laborer 
had  an  allowance  in  aid  of  wages.  I  think  there  can  be  no  doubt 


POPULAR  REMEDIES  FOR  LOW  WAGES  355 


that  if,  at  the  end  of  the  last  century,  the  Allotment  instead  of 
the  Allowance  system  had  been  generally  adopted  in  England,  it 
would  equally  have  broken  down  the  practical  restraints  on 
population  which  at  that  time  did  really  exist;  population  would 
have  started  forward  exactly  as  in  fact  it  did;  and  in  twenty 
years,  wages  plus  the  allotment  would  have  been,  as  wages  plus 
the  allowance  actually  were,  no  more  than  equal  to  the  former 
wages  without  any  allotment.  The  only  difference  in  favor  of 
allotments  would  have  been,  that  they  make  the  people  grow 
their  own  poor-rates. 

I  am  at  the  same  time  quite  ready  to  allow,  that  in  some  cir¬ 
cumstances,  the  possession  of  land  at  a  fair  rent,  even  without 
ownership,  by  the  generality  of  laborers  for  hire,  operates  as 
a  cause  not  of  low,  but  of  high  wages.  This,  however,  is  when 
their  land  renders  them,  to  the  extent  of  actual  necessaries,  inde¬ 
pendent  of  the  market  for  labor.  There  is  the  greatest  differ¬ 
ence  between  the  position  of  people  who  live  by  wages,  with 
land  as  an  extra  resource,  and  of  people  who  can,  in  case  of  ne¬ 
cessity,  subsist  entirely  on  their  land,  and  only  work  for  hire 
to  add  to  their  comforts.  Wages  are  likely  to  be  high  where 
none  are  compelled  by  necessity  to  sell  their  labor.  “  People 
who  have  at  home  some  kind  of  property  to  apply  their  labor  to, 
will  not  sell  their  labor  for  wages  that  do  not  afford  them  a  better 
diet  than  potatoes  and  maize,  although  in  saving  for  themselves 
they  may  live  very  much  on  potatoes  and  maize.  We  are  often 
surprised  in  travelling  on  the  Continent,  to  hear  of  a  rate  of 
day’s  wages  very  high,  considering  the  abundance  and  cheap¬ 
ness  of  food.  It  is  want  of  the  necessity  or  inclination  to  take 
work,  that  makes  day-labor  scarce,  and,  considering  the  price  of 
provisions,  dear,  in  many  parts  of  the  Continent,  where  property 
in  land  is  widely  diffused  among  the  people.”  *  There  are  parts 
of  the  Continent  where,  even  of  the  inhabitants  of  the  towns, 
scarcely  one  seems  to  be  exclusively  dependent  on  his  ostensible 
employment;  and  nothing  else  can  explain  the  high  price  they 
put  on  their  services,  and  the  carelessness  they  evince  as  to 
whether  they  are  employed  at  all.  But  the  effect  would  be  far 
different  if  their  land  or  other  resources  gave  them  only  a  frac¬ 
tion  of  a  subsistence,  leaving  them  under  an  undiminished  neces¬ 
sity  of  selling  their  labor  for  wages  in  an  overstocked  market. 
Their  land  would  then  merely  enable  them  to  exist  on  smaller 

*  Laing’s  “  Notes  of  a  Traveller,”  p.  456. 


356 


POLITICAL  ECONOMY 


wages,  and  to  carry  their  multiplication  so  much  the  further  be¬ 
fore  reaching  the  point  below  which  they  either  could  not,  or 
would  not,  descend. 

To  the  view  I  have  taken  of  the  effect  of  allotments,  I  see  no 
argument  which  can  be  opposed,  but  that  employed  by  Mr. 
Thornton,*  with  whom  on  this  subject  I  am  at  issue.  His  de¬ 
fence  of  allotments  is  grounded  on  the  general  doctrine,  that  it 
is  only  the  very  poor  who  multiply  without  regard  to  conse¬ 
quences,  and  that  if  the  condition  of  the  existing  generation 
could  be  greatly  improved,  which  he  thinks  might  be  done  by 
the  allotment  system,  their  successors  would  grow  up  with  an  in¬ 
creased  standard  of  requirements,  and  would  not  have  families 
until  they  could  keep  them  in  as  much  comfort  as  that  in  which 
they  had  been  brought  up  themselves.  I  agree  in  as  much  of 
this  argument  as  goes  to  prove  that  a  sudden  and  Very  great 
improvement  in  the  condition  of  the  poor,  has  always,  through 
its  effect  on  their  habits  of  life,  a  chance  of  becoming  permanent. 
What  happened  at  the  time  of  the  French  Revolution  is  an  exam¬ 
ple.  But  I  cannot  think  that  the  addition  of  a  quarter  or  even  half 
an  acre  to  every  laborer’s  cottage,  and  that  too  at  a  rack  rent, 
would  (after  the  fall  of  wages  which  would  be  necessary  to  ab¬ 
sorb  the  already  existing  mass  of  pauper  labor)  make  so  great  a 
difference  in  the  comforts  of  the  family  for  a  generation  to  come, 
as  to  raise  up  from  childhood  a  laboring  population  with  a  really 
higher  permanent  standard  of  requirements  and  habits.  So 
small  a  portion  of  land  could  only  be  made  a  permanent  benefit, 
by  holding  out  encouragement  to  acquire  by  industry  and  sav¬ 
ing,  the  means  of  buying  it  outright:  a  permission  which,  if  ex¬ 
tensively  made  use  of,  would  be  a  kind  of  education  in  fore¬ 
thought  and  frugality  to  the  entire  class,  the  effects  of  which 
might  not  cease  with  the  occasion.  The  benefit  would  however 
arise,  not  from  what  was  given  them,  but  from  what  they  were 
stimulated  to  acquire. 

No  remedies  for  low  wages  have  the  smallest  chance  of  being 
efficacious,  which  do  not  operate  on  and  through  the  minds  and 
habits  of  the  people.  While  these  are  unaffected,  any  contriv¬ 
ance,  even  if  successful,  for  temporarily  improving  the  condi¬ 
tion  of  the  very  poor,  would  but  let  slip  the  reins  by  which 
population  was  previously  curbed;  and  could  only,  therefore,  con¬ 
tinue  to  produce  its  effect,  if,  by  the  whip  and  spur  of  taxation, 

*  See  Thornton  on  “  Over-Population,”  chap.  viii. 


REMEDIES  FOR  LOW  WAGES 


357 


capital  were  compelled  to  follow  at  an  equally  accelerated  pace. 
But  this  process  could  not  possibly  continue  for  long  together, 
and  whenever  it  stopped,  it  would  leave  the  country  with  an  in¬ 
creased  number  of  the  poorest  class,  and  a  diminished  propor¬ 
tion  of  all  except  the  poorest,  or,  if  it  continued  long  enough, 
with  none  at  all.  For  “  to  this  complexion  must  come  at  last  ” 
all  social  arrangements,  which  remove  the  natural  checks  to 
population  without  subsistuting  any  others. 

Chapter  XIII. — The  Remedies  for  Low  Wages  Further 

Considered 

§  i.  By  what  means,  then,  is  poverty  to  be  contended  against? 
How  is  the  evil  of  low  wages  to  be  remedied?  If  the  ex¬ 
pedients  usually  recommended  for  the  purpose  are  not  adapted 
to  it,  can  no  others  be  thought  of?  Is  the  problem  incapable 
of  solution?  Can  political  economy  do  nothing,  but  only  object 
to  everything,  and  demonstrate  that  nothing  can  be  done  ? 

If  this  were  so,  political  economy  might  have  a  needful,  but 
would  have  a  melancholy,  and  a  thankless  task.  If  the  bulk 
of  the  human  race  are  always  to  remain  as  at  present,  slaves 
to  toil  in  which  they  have  no  interest,  and  therefore  feel  no 
interest — drudging  from  early  morning  till  late  at  night  for 
bare  necessaries,  and  with  all  the  intellectual  and  moral  defi¬ 
ciencies  which  that  implies — without  resources  either  in  mind 
or  feelings — untaught,  for  they  cannot  be  better  taught  than 
fed ;  selfish,  for  all  their  thoughts  are  required  for  themselves ; 
without  interests  or  sentiments  as  citizens  and  members  of 
society,  and  with  a  sense  of  injustice  rankling  in  their  minds, 
equally  for  what  they  have  not,  and  for  what  others  have;  I 
know  not  what  there  is  which  should  make  a  person  with  any 
capacity  of  reason,  concern  himself  about  the  destinies  of  the 
human  race.  There  would  be  no  wisdom  for  anyone  but  in 
extracting  from  life,  with  Epicurean  indifference,  as  much 
personal  satisfaction  to  himself  and  those  with  whom  he  sym¬ 
pathizes,  as  it  can  yield  without  injury  to  anyone,  and  letting 
the  unmeaning  bustle  of  so-called  civilized  existence  roll  by 
unheeded.  But  there  is  no  ground  for  such  a  view  of  human 
affairs.  Poverty,  like  most  social  evils,  exists  because  men 
follow  their  brute  instincts  without  due  consideration.  But 
society  is  possible,  precisely  because  man  is  not  necessarily  a 


35s 


POLITICAL  ECONOMY 


brute.  Civilization  in  every  one  of  its  aspects  is  a  struggle 
against  the  animal  instincts.  Over  some  even  of  the  strongest 
of  them,  it  has  shown  itself  capable  of  acquiring  abundant  con¬ 
trol.  It  has  artificialized  large  portions  of  mankind  to  such  an 
extent,  that  of  many  of  their  most  natural  inclinations  they 
have  scarcely  a  vestige  or  a  remembrance  left.  If  it  has  not 
brought  the  instinct  of  population  under  as  much  restraint  as  is 
needful,  we  must  remember  that  it  has  never  seriously  tried. 
What  efforts  it  has  made,  have  mostly  been  in  the  contrary  di¬ 
rection.  Religion,  morality,  and  statesmanship  have  vied  with 
one  another  in  incitements  to  marriage,  and  to  the  multiplica¬ 
tion  of  the  species,  so  it  be  but  in  wedlock.  Religion  has  not 
even  yet  discontinued  its  encouragements.  The  Roman  Catholic 
clergy  (of  any  other  clergy  it  is  unnecessary  to  speak,  since  no 
other  have  any  considerable  influence  over  the  poorer  classes) 
everywhere  think  it  their  duty  to  promote  marriage,  in  order 
to  prevent  fornication.  There  is  still  in  many  minds  a  strong 
religious  prejudice  against  the  true  doctrine.  The  rich,  pro¬ 
vided  the  consequences  do  not  touch  themselves,  think  it  im¬ 
pugns  the  wisdom  of  Providence  to  suppose  that  misery  can 
result  from  the  operation  of  a  natural  propensity:  the  poor 
think  that  “  God  never  sends  mouths  but  he  sends  meat.”  No 
one  would  guess  from  the  language  of  either,  that  man  had  any 
voice  or  choice  in  the  matter.  So  complete  is  the  confusion 
of  ideas  on  the  whole  subject:  owing  in  a  great  degree  to 
the  mystery  in  which  it  is  shrouded  by  a  spurious  delicacy, 
which  prefers  that  right  and  wrong  should  be  mismeasured  and 
confounded  on  one  of  the  subjects  most  momentous  to  human 
welfare,  rather  than  that  the  subject  should  be  freely  spoken 
of  and  discussed.  People  are  little  aware  of  the  cost  to  man¬ 
kind  of  this  scrupulosity  of  speech.  The  diseases  of  society 
can,  no  more  than  corporal  maladies,  be  prevented  or  cured 
without  being  spoken  about  in  plain  language.  All  experience 
shows  that  the  mass  of  mankind  never  judge  of  moral  questions 
for  themselves,  never  see  anything  to  be  right  or  wrong  until 
they  have  been  frequently  told  it ;  and  who  tells  them  that  they 
have  any  duties  in  the  matter  in  question,  while  they  keep  within 
matrimonial  limits?  Who  meets  with  the  smallest  condemna¬ 
tion,  or  rather,  who  does  not  meet  with  sympathy  and  benevo¬ 
lence,  for  any  amount  of  evil  which  he  may  have  brought  upon 
himself  and  those  dependent  on  him,  by  this  species  of  inconti- 


REMEDIES  FOR  LOW  WAGES 


359 


nence?  While  a  man  who  is  intemperate  in  drink,  is  discoun¬ 
tenanced  and  despised  by  all  who  profess  to  be  moral  people, 
it  is  one  of  the  chief  grounds  made  use  of  in  appeals  to  the 
benevolent,  that  the  applicant  has  a  large  family  and  is  unable 
to  maintain  them.* 

One  cannot  wonder  that  silence  on  this  great  department  of 
human  duty  should  produce  unconsciousness  of  moral  obliga¬ 
tions,  when  it  produces  oblivion  of  physical  facts.  That  it  is 
possible  to  delay  marriage,  and  to  live  in  abstinence  while  un¬ 
married,  most  people  are  willing  to  allow :  but  when  persons 
are  once  married,  the  idea,  in  this  country,  never  seems  to  enter 
anyone’s  mind  that  having  or  not  having  a  family,  or  the  num¬ 
ber  of  which  it  shall  consist,  is  amenable  to  their  own  control. 
One  would  imagine  that  children  were  rained  down  upon  mar¬ 
ried  people,  direct  from  heaven,  without  their  being  art  or  part 
in  the  matter ;  that  it  was  really,  as  the  common  phrases  have 
it,  God’s  will,  and  not  their  own,  which  decided  the  numbers 
of  their  offspring.  Let  us  see  what  is  a  Continental  philoso¬ 
pher’s  opinion  on  this  point ;  a  man  among  the  most  benevolent 
of  his  time,  and  the  happiness  of  whose  married  life  has  been 
celebrated. 

“  When  dangerous  prejudices,”  says  Sismondi,f  “have  not 
become  accredited,  when  a  morality  contrary  to  our  true  duties 
toward  others,  and  especially  toward  those  to  whom  we  have 
given  life,  is  not  inculcated  in  the  name  of  the  most  sacred 
authority;  no  prudent  man  contracts  matrimony  before  he  is 
in  a  condition  which  gives  him  an  assured  means  of  living, 
and  no  married  man  has  a  greater  number  of  children  than 
he  can  properly  bring  up.  The  head  of  a  family  thinks,  with 
reason,  that  his  children  may  be  contented  with  the  condition 
in  which  he  himself  has  lived ;  and  his  desire  will  be  that  the 
rising  generation  should  represent  exactly  the  departing  one : 
that  one  son  and  one  daughter  arrived  at  the  marriageable  age 
should  replace  his  own  father  and  mother;  that  the  children 
of  his  children  should  in  their  turn  replace  himself  and  his  wife  ; 
that  his  daughter  should  find  in  another  family  the  precise 
equivalent  of  the  lot  which  will  be  given  in  his  own  family  to 
the  daughter  of  another,  and  that  the  income  which  sufficed 

*  Little  improvement  can  be  expected  and  clergy  are  foremost  to  set  the  ex¬ 
in  morality  until  the  producing  large  ample  of  this  kind  of  incontinence 
families  is  regarded  with  the  same  feel-  what  can  be  expected  from  the  poor? 
ings  as  drunkenness  or  any  other  physi-  t  “  New  Principles  of  Political  Econo- 
cal  excess.  But  while  the  aristocracy  my,”  book  vii.  chap.  5. 


36° 


POLITICAL  ECONOMY 


for  the  parents  will  suffice  for  the  children.”  In  a  country  in¬ 
creasing  in  wealth,  some  increase  of  numbers  would  be  admis¬ 
sible,  but  that  is  a  question  of  detail,  not  of  principle.  “  When¬ 
ever  this  family  has  been  formed,  justice  and  humanity  require 
that  he  should  impose  on  himself  the  same  restraint  which  is 
submitted  to  by  the  unmarried.  When  we  consider  how  small, 
in  every  country,  is  the  number  of  natural  children,  we  must 
admit  that  this  restraint  is  on  the  whole  sufficiently  effectual. 
In  a  country  where  population  has  no  room  to  increase,  or  in 
which  its  progress  must  be  so  slow  as  to  be  hardly  perceptible, 
when  there  are  no  places  vacant  for  new  establishments,  a 
father  who  has  eight  children  must  expect,  either  that  six  of 
them  will  die  in  childhood,  or  that  three  men  and  three  women 
among  his  cotemporaries,  and  in  the  next  generation  three  of 
his  sons  and  three  of  his  daughters,  will  remain  unmarried  on 
his  account.” 

§  2.  Those  who  think  it  hopeless  that  the  laboring  classes 
should  be  induced  to  practise  a  sufficient  degree  of  prudence  in 
regard  to  the  increase  of  their  families,  because  they  have  hith¬ 
erto  stopped  short  of  that  point,  show  an  inability  to  estimate 
the  ordinary  principles  of  human  action.  Nothing  more  would 
probably  be  necessary  to  secure  that  result,  than  an  opinion 
generally  diffused  that  it  was  desirable.  As  a  moral  principle, 
such  an  opinion  has  never  yet  existed  in  any  country:  it  is 
curious  that  it  does  not  so  exist  in  countries  in  which,  from  the 
spontaneous  operation  of  individual  forethought,  population  is, 
comparatively  speaking,  efficiently  repressed.  What  is  prac¬ 
tised  as  prudence,  is  still  not  recognized  as  duty ;  the  talkers 
and  writers  are  mostly  on  the  other  side,  even  in  France,  where 
a  sentimental  horror  of  Malthus  is  almost  as  rife  as  in  this 
country.  Many  causes  may  be  assigned,  besides  the  modern 
date  of  the  doctrine,  for  its  not  having  yet  gained  possession 
of  the  general  mind.  Its  truth  has,  in  some  respects,  been  its 
detriment.  One  may  be  permitted  to  doubt  whether,  except 
among  the  poor  themselves  (for  whose  prejudices  on  this  sub¬ 
ject  there  is  no  difficulty  in  accounting)  there  has  ever  yet 
been,  in  any  class  of  society,  a  sincere  and  earnest  desire  that 
wages  should  be  high.  There  has  been  plenty  of  desire  to  keep 
down  the  poor-rate,  but,  that  done,  people  have  been  very  will¬ 
ing  that  the  working  classes  should  be  ill  off.  Nearly  all  who 
are  not  laborers  themselves,  are  employers  of  labor,  and  are 


REMEDIES  FOR  LOW  WAGES 


361 


not  sorry  to  get  the  commodity  cheap.  It  is  a  fact,  that  even 
Boards  of  Guardians,  who  are  supposed  to  be  official  apostles 
of  anti-population  doctrines,  will  seldom  hear  patiently  of  any¬ 
thing  which  they  are  pleased  to  designate  as  Malthusianism. 
Boards  of  Guardians  in  rural  districts,  principally  consist  of 
farmers,  and  farmers,  it  is  well  known,  in  general  dislike  even 
allotments,  as  making  the  laborers  “  too  independent.”  From 
the  gentry,  who  are  in  less  immediate  contact  and  collision  of 
interest  with  the  laborers,  better  things  might  be  expected,  and 
the  gentry  of  England  are  usually  charitable.  But  charitable 
people  have  human  infirmities,  and  would,  very  often,  be  se¬ 
cretly  not  a  little  dissatisfied  if  no  one  needed  their  charity: 
it  is  from  them  one  oftenest  hears  the  base  doctrine,  that  God 
has  decreed  there  shall  always  be  poor.  When  one  adds  to  this, 
that  nearly  every  person  who  has  had  in  him  any  active  spring 
of  exertion  for  a  social  object,  has  had  some  favorite  reform  to 
effect,  which  he  thought  the  admission  of  this  great  principle 
would  throw  into  the  shade ;  has  had  corn  laws  to  repeal,  or 
taxation  to  reduce,  or  small  notes  to  issue,  or  the  charter  to 
carry,  or  the  church  to  revive  or  abolish,  or  the  aristocracy  to 
pull  down,  and  looked  upon  everyone  as  an  enemy  who  thought 
anything  important  except  his  object;  it  is  scarcely  wonderful 
that  since  the  population  doctrine  was  first  promulgated,  nine- 
tenths  of  the  talk  has  always  been  against  it,  and  the  remaining 
tenth  only  audible  at  intervals ;  and  that  it  has  not  yet  pene¬ 
trated  far  among  those  who  might  be  expected  to  be  the  least 
willing  recipients  of  it,  the  laborers  themselves. 

But  let  us  try  to  imagine  what  would  happen  if  the  idea 
became  general  among  the  laboring  class,  that  the  competition 
of  too  great  numbers  was  the  principal  cause  of  their  poverty; 
so  that  every  laborer  looked  (with  Sismondi)  upon  every  other 
who  had  more  than  the  number  of  children  which  the  circum¬ 
stances  of  society  allowed  to  each,  as  doing  him  a  wrong — as 
filling  up  the  place  which  he  was  entitled  to  share.  Anyone 
who  supposes  that  this  state  of  opinion  would  not  have  a  great 
effect  on  conduct,  must  be  profoundly  ignorant  of  human  nat¬ 
ure  ;  can  never  have  considered  how  large  a  portion  of  the 
motives  which  induce  the  generality  of  men  to  take  care  even 
of  their  own  interests,  is  derived  from  regard  for  opinion — 
from  the  expectation  of  being  disliked  or  despised  for  not  doing 
it.  In  the  particular  case  in  question,  it  is  not  too  much  to 


362 


POLITICAL  ECONOMY 


say  that  over-indulgence  is  as  much  caused  by  the  stimulus  of 
opinion  as  by  the  mere  animal  propensity;  since  opinion  uni¬ 
versally,  and  especially  among  the  most  uneducated  classes,  has 
connected  ideas  of  spirit  and  power  with  the  strength  of  the 
instinct,  and  of  inferiority  with  its  moderation  or  absence;  a 
perversion  of  sentiment  caused  by  its  being  the  means,  and  the 
stamp,  of  a  dominion  exercised  over  other  human  beings.  The 
effect  would  be  great  of  merely  removing  this  factitious  stimu¬ 
lus;  and  when  once  opinion  shall  have  turned  itself  into  an 
adverse  direction,  a  revolution  will  soon  take  place  in  this  de¬ 
partment  of  human  conduct.  We  are  often  told  that  the  most 
thorough  perception  of  the  dependence  of  wages  on  population 
will  not  influence  the  conduct  of  a  laboring  man,  because  it  is 
not  the  children  he  himself  can  have  that  will  produce  any  effect 
in  generally  depressing  the  labor  market.  True:  and  it  is  also 
true,  that  one  soldier’s  running  away  will  not  lose  the  battle; 
accordingly  it  is  not  that  consideration  which  keeps  each  soldier 
in  his  rank:  it  is  the  disgrace  which  naturally  and  inevitably 
attends  on  conduct  by  any  one  individual,  which  if  pursued 
by  a  majority,  everybody  can  see  would  be  fatal.  Men  are 
seldom  found  to  brave  the  general  opinion  of  their  class,  unless 
supported  either  by  some  principle  higher  than  regard  for  opin¬ 
ion,  or  by  some  strong  body  of  opinion  elsewhere. 

It  must  be  borne  in  mind  also,  that  the  opinion  here  in  ques¬ 
tion,  as  soon  as  it  attained  any  prevalence,  would  have  powerful 
auxiliaries  in  the  great  majority  of  women.  It  is  seldom  by 
the  choice  of  the  wife  that  families  are  too  numerous;  on  her 
devolves  (along  with  all  the  physical  suffering  and  at  least  a 
full  share  of  the  privations)  the  whole  of  the  intolerable  domes¬ 
tic  drudgery  resulting  from  the  excess.  To  be  relieved  from 
it  would  be  hailed  as  a  blessing  by  multitudes  of  women  who 
now  never  venture  to  urge  such  a  claim,  but  who  would  urge 
it,  if  supported  by  the  moral  feelings  of  the  community.  Among 
the  barbarisms  which  law  and  morals  have  not  yet  ceased  to 
sanction,  the  most  disgusting  surely  is,  that  any  human  being 
should  be  permitted  to  consider  himself  as  having  a  right  to 
the  person  of  another. 

If  the  opinion  were  once  generally  established  among  the 
laboring  class  that  their  welfare  required  a  due  regulation  of 
the  numbers  of  families,  the  respectable  and  well-conducted  of 
the  body  would  conform  to  the  prescription,  and  only  those 


REMEDIES  FOR  LOW  WAGES 


363 


would  exempt  themselves  from  it,  who  were  in  the  habit  of 
making  light  of  social  obligations  generally;  and  there  would 
be  then  an  evident  justification  for  converting  the  moral  obliga¬ 
tion  against  bringing  children  into  the  world  who  are  a  burden 
to  the  community,  into  a  legal  one;  just  as  in  many  other  cases 
of  the  progress  of  opinion,  the  law  ends  by  enforcing  against 
recalcitrant  minorities,  obligations  which  to  be  useful  must  be 
general,  and  which,  from  a  sense  of  their  utility,  a  large  major¬ 
ity  have  voluntarily  consented  to  take  upon  themselves.  There  . 
would  be  no  need,  however,  of  legal  sanctions,  if  women  were 
admitted,  as  on  all  other  grounds  they  have  the  clearest  title 
to  be,  to  the  same  rights  of  citizenship  with  men.  Let  them  cease 
to  be  confined  by  custom  to  one  physical  function  as  their  means 
of  living  and  their  source  of  influence,  and  they  would  have 
for  the  first  time  an  equal  voice  with  men  in  what  concerns  that 
function :  and  of  all  the  improvements  in  reserve  for  mankind 
which  it  is  now  possible  to  foresee,  none  might  be  expected  to 
be  so  fertile  as  this  in  almost  every  kind  of  moral  and  social 
benefit. 

It  remains  to  consider  what  chance  there  is  that  opinion  and 
feelings,  grounded  on  the  law  of  the  dependence  of  wages  on 
population,  will  arise  among  the  laboring  classes ;  and  by  what 
means  such  opinions  and  feelings  can  be  called  forth.  Before 
considering  the  grounds  of  hope  on  this  subject,  a  hope  which 
many  persons,  no  doubt,  will  be  ready,  without  consideration, 
to  pronounce  chimerical,  I  will  remark,  that  unless  a  satisfac¬ 
tory  answer  can  be  made  to  these  two  questions,  the  industrial 
system  prevailing  in  this  country,  and  regarded  by  many  writers 
as  the  ne  plus  ultra  of  civilization — the  dependence  of  the  whole 
laboring  class  of  the  community  on  the  wages  of  hired  labor — 
is  irrevocably  condemned.  The  question  we  are  considering  is, 
whether,  of  this  state  of  things,  overpopulation  and  a  degraded 
condition  of  the  laboring  class  are  the  inevitable  consequence. 
If  a  prudent  regulation  of  population  be  not  reconcilable  with 
the  system  of  hired  labor,  the  system  is  a  nuisance,  and  the 
grand  object  of  economical  statesmanship  should  be  (by  what¬ 
ever  arrangements  of  property,  and  alterations  in  the  modes 
of  applying  industry),  to  bring  the  laboring  people  under  the 
influence  of  stronger  and  more  obvious  inducements  to  this 
kind  of  prudence,  than  the  relation  of  workmen  and  employers 
can  afford. 


364 


POLITICAL  ECONOMY 


But  there  exists  no  such  incompatibility.  The  causes  of  pov¬ 
erty  are  not  so  obvious  at  first  sight  to  a  population  of  hired 
laborers,  as  they  are  to  one  of  proprietors,  or  as  they  would 
be  to  a  socialist  community.  They  are,  however,  in  no  way 
mysterious.  The  dependence  of  wages  on  the  number  of  com¬ 
petitors  for  employment,  is  so  far  from  hard  of  comprehension, 
or  unintelligible  to  the  laboring  classes,  that  bv  great  bodies 
of  them  it  is  already  recognized  and  habitually  acted  on.  It  is 
Tamiliar  to  all  Trades  Unions;  every  successful  combination 
to  keep  up  wages,  owes  its  success  to  contrivances  for  restrict¬ 
ing  the  number  of  the  competitors ;  all  skilled  trades  are  anxious 
to  keep  down  their  own  numbers,  and  many  impose,  or  endeavor 
to  impose,  as  a  condition  upon  employers,  that  they  shall  not 
take  more  than  a  prescribed  number  of  apprentices.  There  is, 
of  course,  a  great  difference  between  limiting  their  numbers  by 
excluding  other  people,  and  doing  the  same  thing  by  a  restraint 
imposed  on  themselves :  but  the  one  as  much  as  the  other  shows 
a  clear  perception  of  the  relation  between  their  numbers  and 
their  remuneration.  The  principle  is  understood  in  its  applica¬ 
tion  to  any  one  employment,  but  not  to  the  general  mass  of  em¬ 
ployment.  For  this  there  are  several  reasons :  first,  the  opera¬ 
tion  of  causes  is  more  easily  and  distinctly  seen  in  the  more 
circumscribed  field :  secondly,  skilled  artisans  are  a  more  in¬ 
telligent  class  than  ordinary  manual  laborers;  and  the  habit 
of  concert,  and  of  passing  in  review  their  general  condition  as 
a  trade,  keeps  up  a  better  understanding  of  their  collective  in¬ 
terests  :  thirdly  and  lastly,  they  are  the  most  provident,  because 
they  are  the  best  off,  and  have  the  most  to  preserve.  What, 
however,  is  clearly  perceived  and  admitted  in  particular  in¬ 
stances,  it  cannot  be  hopeless  to  see  understood  and  acknowl¬ 
edged  as  a  general  truth.  Its  recognition,  at  least  in  theory, 
seems  a  thing  which  must  necessarily  and  immediately  come 
to  pass,  when  the  minds  of  the  laboring  classes  become  capable 
of  taking  any  rational  view  of  their  own  aggregate  condition. 
Of  this  the  great  majority  of  them  have  until  now  been  inca¬ 
pable,  either  from  the  uncultivated  state  of  their  intelligence, 
or  from  poverty,  which  leaving  them  neither  the  fear  of  worse, 
nor  the  smallest  hope  of  better,  makes  them  careless  of  the  con¬ 
sequences  of  their  actions,  and  without  thought  for  the  future. 

§  3.  For  the  purpose  therefore  of  altering  the  habits  of  the 
laboring  people,  there  is  need  of  a  twofold  action,  directed  si- 


REMEDIES  FOR  LOW  WAGES 


365 


multaneously  upon  their  intelligence  and  their  poverty.  An 
effective  national  education  of  the  children  of  the  laboring  class, 
is  the  first  thing  needful :  and,  coincidently  with  this,  a  system 
of  measures  which  shall  (as  the  Revolution  did  in  France)  ex¬ 
tinguish  extreme  poverty  for  one  whole  generation. 

This  is  not  the  place  for  discussing,  even  in  the  most  general 
manner,  either  the  principles  or  the  machinery  of  national  edu¬ 
cation.  But  it  is  to  be  hoped  that  opinion  on  the  subject  is 
advancing,  and  that  an  education  of  mere  words  would  not 
now  be  deemed  sufficient,  slow  as  our  progress  is  toward  pro¬ 
viding  anything  better  even  for  the  classes  to  whom  society 
professes  to  give  the  very  best  education  it  can  devise.  Without 
entering  into  disputable  points,  it  may  be  asserted  without 
scruple,  that  the  aim  of  all  intellectual  training  for  the  mass  of 
the  people,  should  be  to  cultivate  common  sense ;  to  qualify 
them  for  forming  a  sound  practical  judgment  of  the  circum¬ 
stances  by  which  they  are  surrounded.  Whatever,  in  the  intel¬ 
lectual  department,  can  be  superadded  to  this,  is  chiefly  orna¬ 
mental  ;  while  this  is  the  indispensable  groundwork  on  which 
education  must  rest.  Let  this  object  be  acknowledged  and  kept 
in  view  as  the  thing  to  be  first  aimed  at,  and  there  will  be  little 
difficulty  in  deciding  either  what  to  teach,  or  in  what  manner 
to  teach  it. 

An  education  directed  to  diffuse  good  sense  among  the  people, 
with  such  knowledge  as  would  qualify  them  to  judge  of  the  ten¬ 
dencies  of  their  actions,  would  be  certain,  even  without  any 
direct  inculcation,  to  raise  up  a  public  opinion  by  which  intem¬ 
perance  and  improvidence  of  every  kind  would  be  held  discred¬ 
itable,  and  the  improvidence  which  overstocks  the  labor  market 
would  be  severely  condemned,  as  an  offence  against  the  common 
weal.  But  though  the  sufficiency  of  such  a  state  of  opinion,  sup- . 
posing  it  formed,  to  keep  the  increase  of  population  within  j 
proper  limits,  cannot,  I  think,  be  doubted;  yet,  for  the  forma- 1 
tion  of  the  opinion,  it  would  not  do  to  trust  to  education  alone. 
Education  is  not  compatible  with  extreme  poverty.  It  is  im¬ 
possible  effectually  to  teach  an  indigent  population.  And  it 
is  difficult  to  make  those  feel  the  value  of  comfort  who  have 
never  enjoyed  it,  or  those  appreciate  the  wretchedness  of  a  pre¬ 
carious  subsistence,  who  have  been  made  reckless  by  always 
living  from  hand  to  mouth.  Individuals  often  struggle  upward 
into  a  condition  of  ease;  but  the  utmost  that  can  be  expected 


366 


POLITICAL  ECONOMY 


from  a  whole  people  is  to  maintain  themselves  in  it;  and  im¬ 
provement  in  the  habits  and  requirements  of  the  mass  of  un¬ 
skilled  day  laborers  will  be  difficult  and  tardy,  Unless  means  can 
be  contrived  of  raising  the  entire  body  to  a  state  of  tolerable 
comfort,  and  maintaining  them  in  it  until  a  new  generation 
grows  up. 

Toward  effecting  this  object  there  are  two  resources  avail¬ 
able,  without  wrong  to  anyone,  without  any  of  the  liabilities 
of  mischief  attendant  on  voluntary  or  legal  charity,  and  not 
only  without  weakening,  but  on  the  contrary  strengthening 
every  incentive  to  industry,  and  every  motive  to  forethought. 

§  4.  The  first  is,  a  great  national  measure  of  colonization. 
I  mean,  a  grant  of  public  money,  sufficient  to  remove  at  once, 
and  establish  in  the  colonies,  a  considerable  fraction  of  the 
youthful  agricultural  population.  By  giving  the  preference,  as 
Mr.  Wakefield  proposes,  to  young  couples,  or  when  these  can¬ 
not  be  obtained,  to  families  with  children  nearly  grown  up, 
the  expenditure  would  be  made  to  go  the  furthest  possible  to¬ 
ward  accomplishing  the  end,  while  the  colonies  would  be  sup¬ 
plied  with  the  greatest  amount  of  what  is  there  in  deficiency 
and  here  in  superfluity,  present  and  prospective  labor.  It  has 
been  shown  by  others,  and  the  grounds  of  the  opinion  will  be 
exhibited  in  a  subsequent  part  of  the  present  work,  that  coloni¬ 
zation  on  an  adequate  scale  might  be  so  conducted  as  to  cost 
the  country  nothing,  or  nothing  that  would  not  be  certainly 
repaid ;  and  that  the  funds  required,  even  by  way  of  advance, 
would  not  be  drawn  from  the  capital  employed  in  maintaining 
labor,  but  from  that  surplus  which  cannot  find  employment  at 
such  profit  as  constitutes  an  adequate  remuneration  for  the 
abstinence  of  the  possessor,  and  which  is  therefore  sent  abroad 
for  investment,  or  wasted  at  home  in  reckless  speculations.  That 
portion  of  the  income  of  the  country  which  is  habitually  inef¬ 
fective  for  any  purpose  of  benefit  to  the  laboring  class,  would 
bear  any  draught  which  it  could  be  necessary  to  make  on  it  for 
the  amount  of  emigration  which  is  here  in  view. 

The  second  resource  would  be,  to  devote  all  common  land, 
hereafter  brought  into  cultivation,  to  raising  a  class  of  small 
proprietors.  It  has  long  enough  been  the  practice  to  take  these 
lands  from  public  use,  for  the  mere  purpose  of  adding  to  the 
domains  of  the  rich.  It  is  time  that  what  is  left  of  them  should 
be  retained  as  an  estate  sacred  to  the  benefit  of  the  poor.  The 


REMEDIES  FOR  LOW  WAGES 


367 


machinery  for  administering  it  already  exists,  having  been  cre¬ 
ated  by  the  General  Inclosure  Act.  What  I  would  propose 
(though,  I  confess,  with  small  hope  of  its  being  soon  adopted) 
is,  that  in  all  future  cases  in  which  common  land  is  permitted 
to  be  inclosed,  such  portion  should  first  be  sold  or  assigned  as 
is  sufficient  to  compensate  the  owners  of  manorial  or  common 
rights,  and  that  the  remainder  should  be  divided  into  sections 
of  five  acres  or  thereabouts,  to  be  conferred  in  absolute  property 
on  individuals  of  the  laboring  class  who  would  reclaim  and 
bring  them  into  cultivation  by  their  own  labor.  The  prefer¬ 
ence  should  be  given  to  such  laborers,  and  there  are  many  of 
them,  as  had  saved  enough  to  maintain  them  until  their  first 
crop  was  got  in,  or  whose  character  was  such  as  to  induce  some 
responsible  person  to  advance  to  them  the  requisite  amount  on 
their  personal  security.  The  tools,  the  manure,  and  in  some 
cases  the  subsistence  also,  might  be  supplied  by  the  parish,  or 
by  the  state;  interest  for  the  advance,  at  the  rate  yielded  by 
the  public  funds,  being  laid  on  as  a  perpetual  quit-rent,  with 
power  to  the  peasant  to  redeem  it  at  any  time  for  a  moderate 
number  of  years’  purchase.  These  little  landed  estates  might, 
if  it  were  thought  necessary,  be  made  indivisible  by  law  ;  though, 
if  the  plan  worked  in  the  manner  designed,  I  should  not  appre¬ 
hend  any  objectionable  degree  of  subdivision.  In  case  of  in¬ 
testacy,  and  in  default  of  amicable  arrangement  among  the 
heirs,  they  might  be  bought  by  government  at  their  value,  and 
regranted  to  some  other  laborer  who  could  give  security  for 
the  price.  The  desire  to  possess  one  of  these  small  properties 
would  probably  become,  as  on  the  Continent,  an  inducement  to 
prudence  and  economy  pervading  the  whole  laboring  popula¬ 
tion;  and  that  great  desideratum  among  a  people  of  hired  la¬ 
borers  would  be  provided,  an  intermediate  class  between  them 
and  their  employers ;  affording  them  the  double  advantage,  of 
an  object  for  their  hopes,  and,  as  there  would  be  good  reason 
to  anticipate,  an  example  for  their  imitation. 

It  would,  however,  be  of  little  avail  that  either  or  both  of 
these  measures  of  relief  should  be  adopted,  unless  on  such  a 
scale,  as  would  enable  the  whole  body  of  hired  laborers  remain¬ 
ing  on  the  soil  to  obtain  not  merely  employment,  but  a  large 
addition  to  the  present  wages — such  an  addition  as  would  en¬ 
able  them  to  live  and  bring  up  their  children  in  a  degree  of  com¬ 
fort  and  independence  to  which  they  have  hitherto  been  stran- 


368 


POLITICAL  ECONOMY 


gers.  When  the  object  is  to  raise  the  permanent  condition  of 
a  people,  small  means  do  not  merely  produce  small  effects,  they 
produce  no  effect  at  all.  Unless  comfort  can  be  made  as  habit¬ 
ual  to  a  whole  generation  as  indigence  is  now,  nothing  is  ac¬ 
complished;  and  feeble  half  measures  do  but  fritter  away  re¬ 
sources,  far  better  reserved  until  the  improvement  of  public 
opinion  and  of  education  shall  raise  up  politicians  who  will  not 
think  that  merely  because  a  scheme  promises  much,  the  part  of 
statesmanship  is  to  have  nothing  to  do  with  it. 

I  have  left  the  preceding  paragraphs  as  they  were  written, 
since  they  remain  true  in  principle,  though  it  is  no  longer  urgent 
to  apply  their  specific  recommendations  to  the  present  state  of 
this  country.  The  extraordinary  cheapening  of  the  means  of 
transport,  which  is  one  of  the  great  scientific  achievements  of 
the  age,  and  the  knowledge  which  nearly  all  classes  of  the  people 
have  now  acquired,  or  are  in  the  way  of  acquiring,  of  the  con¬ 
dition  of  the  labor  market  in  remote  parts  of  the  world,  have 
opened  up  a  spontaneous  emigration  from  these  islands  to  the 
new  countries  beyond  the  ocean,  which  does  not  tend  to  dimin¬ 
ish,  but  to  increase ;  and  which,  without  any  national  measure 
of  systematic  colonization,  may  prove  sufficient  to  effect  a  mate¬ 
rial  rise  of  wages  in  Great  Britain,  as  it  has  already  done  in 
Ireland,  and  to  maintain  that  rise  unimpaired  for  one  or  more 
generations.  Emigration,  instead  of  an  occasional  vent,  is  be¬ 
coming  a  steady  outlet  for  superfluous  numbers ;  and  this  new 
fact  in  modern  history,  together  with  the  flush  of  prosperity 
occasioned  by  free  trade,  have  granted  to  this  overcrowded 
country  a  temporary  breathing  time,  capable  of  being  employed 
in  accomplishing  those  moral  and  intellectual  improvements  in 
all  classes  of  the  people,  the  very  poorest  included,  which  would 
render  improbable  any  relapse  into  the  overpeopled  state. 
Whether  this  golden  opportunity  will  be  properly  used,  depends 
on  the  wisdom  of  our  councils ;  and  whatever  depends  on  that, 
is  always  in  a  high  degree  precarious.  The  grounds  of  hope 
are,  that  there  has  been  no  time  in  our  history  when  mental 
progress  has  depended  so  little  on  governments,  and  so  much 
on  the  general  disposition  of  the  people;  none  in  which  the 
spirit  of  improvement  has  extended  to  so  many  branches  of 
human  affairs  at  once,  nor  in  which  all  kinds  of  suggestions 
tending  to  the  public  good,  in  every  department,  from  the  hum¬ 
blest  physical  to  the  highest  moral  or  intellectual,  were  heard 


DIFFERENCES  OF  WAGES  369 

with  so  little  prejudice,  and  had  so  good  a  chance  of  becoming 
known  and  being  fairly  considered. 


Chapter  XIV. — Of  the  Differences  of  Wages  in  Different 

Employments 

§  1.  In  treating  of  wages,  we  have  hitherto  confined  our¬ 
selves  to  the  causes  which  operate  on  them  generally,  and  en 
masse ;  the  laws  which  govern  the  remuneration  of  ordinary 
or  average  labor:  without  reference  to  the  existence  of  differ¬ 
ent  kinds  of  work  which  are  habitually  paid  at  different  rates, 
depending  in  some  degree  on  different  laws.  We  will  now  take 
into  consideration  these  differences,  and  examine  in  what  man¬ 
ner  they  affect  or  are  affected  by  the  conclusions  already  es¬ 
tablished. 

A  well-known  and  very  popular  chapter  of  Adam  Smith  * 
contains  the  best  exposition  yet  given  of  this  portion  of  the 
subject.  I  cannot  indeed  think  his  treatment  so  complete  and 
exhaustive  as  it  has  sometimes  been  considered ;  but  as  far  as 
it  goes,  his  analysis  is  tolerably  successful. 

The  differences,  he  says,  arise  partly  from  the  policy  of  Eu¬ 
rope,  which  nowhere  leaves  things  at  perfect  liberty,  and  partly 
“  from  certain  circumstances  in  the  employments  themselves, 
which  either  really,  or  at  least  in  the  imaginations  of  men,  make 
up  for  a  small  pecuniary  gain  in  some,  and  counterbalance 
a  great  one  in  others.”  These  circumstances  he  considers  to 
be :  “  First,  the  agreeableness  or  disagreeableness  of  the  em¬ 
ployments  themselves ;  secondly,  the  easiness  and  cheapness, 
or  the  difficulty  and  expense  of  learning  them  ;  thirdly,  the  con¬ 
stancy  or  inconstancy  of  employment  in  them ;  fourthly,  the 
small  or  great  trust  which  must  be  reposed  in  those  who  exer¬ 
cise  them ;  and  fifthly,  the  probability  or  improbability  of  suc¬ 
cess  in  them.” 

Several  of  these  points  he  has  very  copiously  illustrated : 
though  his  examples  are  sometimes  drawn  from  a  state  of  facts 
now  no  longer  existing.  “  The  wages  of  labor  vary  with  the 
ease  or  hardship,  the  cleanliness  or  dirtiness,  the  honorableness 
or  dishonorableness  of  the  employment.  Thus,  in  most  places, 
take  the  year  round,  a  journeyman  tailor  earns  less  than  a 
journeyman  weaver.  His  work  is  much  easier.”  Things  have 

*  “  Wealth  of  Nations,”  book  i.  chap.  10. 

VOL.  I.— 24 


37° 


POLITICAL  ECONOMY 


much  altered,  as  to  a  weaver’s  remuneration,  since  Adam 
Smith’s  time ;  and  the  artisan  whose  work  was  more  difficult 
than  that  of  a  tailor,  can  never,  I  think,  have  been  the  common 
weaver.  “  A  journeyman  weaver  earns  less  than  a  journeyman 
smith.  His  work  is  not  always  easier,  but  it  is  much  cleanlier.” 
A  more  probable  explanation  is,  that  it  requires  less  bodily 
strength.  “  A  journeyman  blacksmith,  though  an  artificer,  sel¬ 
dom  earns  so  much  in  twelve  hours  as  a  collier,  who  is  only 
a  laborer,  does  in  eight.  His  work  is  not  quite  so  dirty,  is  less 
dangerous,  and  is  carried  on  in  daylight,  and  above  ground. 
Honor  makes  a  great  part  of  the  reward  of  all  honorable  pro¬ 
fessions.  In  point  of  pecuniary  gain,  all  things  considered,” 
their  recompense  is,  in  his  opinion,  below  the  average.  “  Dis¬ 
grace  has  the  contrary  effect.  The  trade  of  a  butcher  is  a 
brutal  and  an  odious  business ;  but  it  is  in  most  places  more 
profitable  than  the  greater  part  of  common  trades.  The  most 
detestable  of  all  employments,  that  of  public  executioner,  is, 
in  proportion  to  the  quantity  of  work  done,  better  paid  than 
any  common  trade  whatever.” 

One  of  the  causes  which  make  hand-loom  weavers  cling  to 
their  occupation  in  spite  of  the  scanty  remuneration  which  it 
now  yields,  is  said  to  be  a  peculiar  attractiveness,  arising  from 
the  freedom  of  action  which  it  allows  to  the  workman.  “  He 
can  play  or  idle,”  says  a  recent  authority,*  “  as  feeling  or  incli¬ 
nation  lead  him ;  rise  early  or  late,  apply  himself  assiduously 
or  carelessly,  as  he  pleases,  and  work  up  at  any  time,  by  in¬ 
creased  exertion,  hours  previously  sacrificed  to  indulgence  or 
recreation.  There  is  scarcely  another  condition  of  any  portion 
of  our  working  population  thus  free  from  external  control.  The 
factory  operative  is  not  only  mulcted  of  his  wages  for  absence, 
but,  if  of  frequent  occurrence,  discharged  altogether  from  his 
employment.  The  bricklayer,  the  carpenter,  the  painter,  the 
joiner,  the  stonemason,  the  outdoor  laborer,  have  each  their 
appointed  daily  hours  of  labor,  a  disregard  of  which  would  lead 
to  the  same  result.”  Accordingly,  “  the  weaver  will  stand  by 
his  loom  while  it  will  enable  him  to  exist,  however  miserably; 
and  many,  induced  temporarily  to  quit  it,  have  returned  to  it 
again,  when  work  was  to  be  had.” 

“  Employment  is  much  more  constant,”  continues  Adam 

*  Mr.  Muggeridge’s  Report  to  the  Handloom  Weavers  Inquiry  Commis¬ 
sion. 


DIFFERENCES  OF  WAGES 


37i 


Smith,  “  in  some  trades  than  in  others.  In  the  greater  part  of 
manufactures,  a  journeyman  may  be  pretty  sure  of  employ¬ 
ment  almost  every  day  in  the  year  that  he  is  able  to  work  ”  (the 
interruptions  of  business  arising  from  overstocked  markets, 
or  from  a  suspension  of  demand,  or  from  a  commercial  crisis, 
must  be  excepted).  “  A  mason  or  bricklayer,  on  the  contrary, 
can  work  neither  in  hard  frost  nor  in  foul  weather,  and  his  em¬ 
ployment  at  all  other  times  depends  upon  the  occasional  calls 
of  his  customers.  He  is  liable,  in  consequence,  to  be  frequently 
without  any.  What  he  earns,  therefore,  while  he  is  employed, 
must  not  only  maintain  him  while  he  is  idle,  but  make  him  some 
compensation  for  those  anxious  and  desponding  moments  which 
the  thought  of  so  precarious  a  situation  must  sometimes  occa¬ 
sion.  When  the  computed  earnings  of  the  greater  part  of  man¬ 
ufacturers,  accordingly,  are  nearly  upon  a  level  with  the  day 
wages  of  common  laborers,  those  of  masons  and  bricklayers 
are  generally  from  one-half  more  to  double  those  wages.  No 
species  of  skilled  labor,  however,  seems  more  easy  to  learn  than 
that  of  masons  and  bricklayers.  The  high  wages  of  those  work¬ 
men,  therefore,  are  not  so  much  the  recompense  of  their  skill, 
as  the  compensation  for  the  inconstancy  of  their  employment. 

“  When  the  inconstancy  of  the  employment  is  combined  with 
the  hardship,  disagreeableness,  and  dirtiness  of  the  work,  it 
sometimes  raises  the  wages  of  the  most  common  labor  above 
those  of  the  most  skilful  artificers.  A  collier  working  by  the 
piece  is  supposed,  at  Newcastle,  to  earn  commonly  about  double, 
and  in  many  parts  of  Scotland  about  three  times,  the  wages  of 
common  labor.  His  high  wages  arise  altogether  from  the  hard¬ 
ship,  disagreeableness,  and  dirtiness  of  his  work.  His  employ¬ 
ment  may,  upon  most  occasions,  be  as  constant  as  he  pleases. 
The  coal-heavers  in  London  exercise  a  trade  which  in  hardship, 
dirtiness,  and  disagreeableness,  almost  equals  that  of  colliers ; 
and  from  the  unavoidable  irregularity  in  the  arrivals  of  coal- 
ships,  the  employment  of  the  greater  part  of  them  is  necessarily 
very  inconstant.  If  colliers,  therefore,  commonly  earn  double 
and  triple  the  wages  of  common  labor,  it  ought  not  to  seem  un¬ 
reasonable  that  coal-heavers  should  sometimes  earn  four  or  five 
times  those  wages.  In  the  inquiry  made  into  their  condition 
a  few  years  ago,  it  was  found  that  at  the  rate  at  which  they 
were  then  paid,  they  could  earn  about  four  times  the  wages  of 
common  labor  in  London.  How  extravagant  soever  these  earn- 


372 


POLITICAL  ECONOMY 


ings  may  appear,  if  they  were  more  than  sufficient  to  compen¬ 
sate  all  the  disagreeable  circumstances  of  the  business,  there 
would  soon  be  so  great  a  number  of  competitors  as,  in  a  trade 
which  has  no  exclusive  privilege,  would  quickly  reduce  them 
to  a  lower  rate.” 

These  inequalities  of  remuneration,  which  are  supposed  to 
compensate  for  the  disagreeable  circumstances  of  particular 
employments,  would,  under  certain  conditions,  be  natural  con¬ 
sequences  of  perfectly  free  competition :  and  as  between  em¬ 
ployments  of  about  the  same  grade,  and  filled  by  nearly  the 
same  description  of  people,  they  are,  no  doubt,  for  the  most  part, 
realized  in  practice.  But  it  is  altogether  a  false  view  of  the 
state  of  facts,  to  present  this  as  the  relation  which  generally 
exists  between  agreeable  and  disagreeable  employments.  The 
really  exhausting  and  the  really  repulsive  labors,  instead  of 
being  better  paid  than  others,  are  almost  invariably  paid  the 
worst  of  all,  because  performed  by  those  who  have  no  choice. 
It  would  be  otherwise  in  a  favorable  state  of  the  general  labor 
market.  If  the  laborers  in  the  aggregate,  instead  of  exceeding, 
fell  short  of  the  amount  of  employment,  work  which  was  gen¬ 
erally  disliked  would  not  be  undertaken,  except  for  more  than 
ordinary  wages.  But  when  the  supply  of  labor  so  far  exceeds 
the  demand  that  to  find  employment  at  all  is  an  uncertainty,  and 
to  be  offered  it  on  any  terms  a  favor,  the  case  is  totally  the 
reverse.  Desirable  laborers,  those  whom  everyone  is  anxious 
to  have,  can  still  exercise  a  choice.  The  undesirable  must  take 
what  they  can  get.  The  more  revolting  the  occupation,  the 
more  certain  it  is  to  receive  the  minimum  of-  remuneration,  be¬ 
cause  it  devolves  on  the  most  helpless  and  degraded,  on  those 
yffio  from  squalid  poverty,  or  from  want  of  skill  and  education, 
are  rejected  from  all  other  employments.  Partly  from  this 
cause,  and  partly  from  the  natural  and  artificial  monopolies 
which  will  be  spoken  of  presently,  the  inequalities  of  wages  are 
generally  in  an  opposite  direction  to  the  equitable  principle  of 
compensation  erroneously  represented  by  Adam  Smith  as  the 
general  law  of  the  remuneration  of  labor.  The  hardships  and 
the  earnings,  instead  of  being  directly  proportional,  as  in  any 
just  arrangements  of  society  they  would  be,  are  generally  in 
an  inverse  ratio  to  one  another. 

One  of  the  points  best  illustrated  by  Adam  Smith,  is  the  in- 
fluence  exercised  on  the  remuneration  of  an  employment  bv  the 


DIFFERENCES  OF  WAGES 


373 


^uncertainty  of  success  in  it.  JL  the  chances  are  great  of  total 
failure,  the  reward  in  case  of  success  must  be  sufficient  to  make 
up,  in  the  general  estimation,  for  those  adverse  chances.  But, 
owing  to  another  principle  of  human  nature,  if  the  reward  comes 
m  the  shape  of  a  few  great  prizes,  it  usually  attracts  competitors 
m  such  numbers  that  the  average  remuneration  may  be  reduced 
fnot  only  to  zero,  but  even  to  a  negative  quantity.  The  success 
of  lotteries  proves  that  this  is  possible:  since  the  aggregate 
body  of  adventurers  in  lotteries  necessarily  lose,  otherwise  the 
undertakers  could  not  gain.  The  case  of  certain  professions  is 
considered  by  Adam  Smith  to  be  similar.  “  The  probability 
that  any  particular  person  shall  ever  be  qualified  for  the  em¬ 
ployment  to  which  he  is  educated,  is  very  different  in  different 
occupations.  In  the  greater  part  of  mechanic  trades,  success 
is  almost  certain,  but  very  uncertain  in  the  liberal  professions. 
Put  your  son  apprentice  to  a  shoemaker,  there  is  little  doubt 
of  his  learning  to  make  a  pair  of  shoes ;  but  send  him  to  study 
the  law,  it  is  at  least  twenty  to  one  if  ever  he  makes  such  pro¬ 
ficiency  as  will  enable  him  to  live  by  the  business.  In  a  per¬ 
fectly  fair  lottery,  those  who  draw  the  prizes  ought  to  gain  all 
that  is  lost  by  those  who  draw  the  blanks.  In  a  profession  where 
twenty  fail  for  one  that  succeeds,  that  one  ought  to  gain  all  that 
should  have  been  gained  by  the  unsuccessful  twenty.  The^ 
counsellor-at-law,  who,  perhaps,  at  near  forty  .years  of  ag<y 
begins  to  make  something  by  his  profession,  ought  to  receive  , 
the  retribution,  not  only  of  his  own  so  tedious  and  expensive 

education,  but  of  that  of  more  than. twenty  others  who_ are 
never  likely  to  make  anything  by  it.  How  extravagant  soever 
flie  fees  of  counsellors-at-law  may  sometimes  appear,  their  real  _ 
retribution  is  never  equal  to  this.  Compute  in  any  particular 
place  what  is  likely  to  be  annually  gained,  and  what  is  likely 
to  be  annually  spent,  by  all  the  different  workmen  in  any  com¬ 
mon  trade,  such  as  that  of  shoemakers  or  weavers,  and  you 
will  find  that  the  former  sum  will  generally  exceed  the  latter. 
But  make  the  same  computation  with  regard  to  all  the  coun¬ 
sellors  and  students  of  law,  in  all  the  different  inns  of  court, 
and  you  will  find  that  their  annual  gains  bear  but  a  small  pro¬ 
portion  to  their  annual  expense,  even  though  you  rate  the 
former  as  high,  and  the  latter  as  low,  as  can  well  be  done.” 

Whether  this  is  true  in  our  own  day,  when  the  gains  of  the 
few  are  incomparably  greater  than  in  the  time  of  Adam  Smith, 


374 


POLITICAL  ECONOMY 


but  also  the  unsuccessful  aspirants  much  more  numerous,  those 
who  have  the  appropriate  information  must  decide.  It  does 
not,  however,  seem  to  be  sufficiently  considered  by  Adam  Smith, 
that  the  prizes  which  he  speaks  of  comprise  not  the  fees  of  coun¬ 
sel  only,  but  the  places  of  emolument  and  honor  to  which  their 
profession  gives  access,  together  with  the  coveted  distinction 
of  a  conspicuous  position  in  the  public  eye. 

Even  where  there  are  no  great  prizes,  the  mere  love  of  ex¬ 
citement  is  sometimes  enough  to  cause  an  adventurous  employ¬ 
ment  to  be  overstocked.  This  is  apparent  “  in  the  readiness 
of  the  common  people  to  enlist  as  soldiers,  or  to  go  to  sea. 
.  .  .  The  dangers  and  hair-breadth  escapes  of  a  life  of  adven¬ 
tures,  instead  of  disheartening  young  people,  seem  frequently 
to  recommend  a  trade  to  them.  A  tender  mother,  among  the 
inferior  ranks  of  people,  is  often  afraid  to  send  her  son  to  school 
at  a  sea-port  town,  lest  the  sight  of  the  ships  and  the  conversa¬ 
tion  and  adventures  of  the  sailors  should  entice  him  to  go  to 
sea.  The  distant  prospect  of  hazards,  from  which  we  can  hope 
to  extricate  ourselves  by  courage  and  address,  is  not  disagree¬ 
able  to  us,  and  does  not  raise  the  wages  of  labor  in  any  employ¬ 
ment.  It  is  otherwise  with  those  in  which  courage  and  address 
can  be  of  no  avail.  In  trades  which  are  known  to  be  very  un¬ 
wholesome,  the  wages  of  labor  are  always  remarkably  high. 
Unwholesomeness  is  a  species  of  disagreeableness,  and  its  ef¬ 
fects  upon  the  wages  of  labor  are  to  be  ranked  under  that  gen¬ 
eral  head.” 

§  2.  The  preceding  are  cases  in  which  inequality  of  remu¬ 
neration  is  necessary  to  produce  equality  of  attractiveness,  and 
are  examples  of  the  equalizing  effect  of  free  competition.  The 
following  are  cases  of  real  inequality,  and  arise  from  a  different 
principle.  “  The  wages  of  labor  vary  according  to  the  small 
or  great  trust  which  must  be  reposed  in  the  workmen.  The 
wages  of  goldsmiths  and  jewellers  are  everywhere  superior  to 
those  of  many  other  workmen,  not  only  of  equal,  but  of  much 
superior  ingenuity ;  on  account  of  the  precious  materials  with 
which  they  are  intrusted.  We  trust  our  health  to  the  physician, 
our  fortune  and  sometimes  our  life  and  reputation  to  the  lawyer 
and  attorney.  Such  confidence  could  not  safely  be  reposed  in 
people  of  a  very  mean  or  low  condition.  Their  reward  must 
be  such,  therefore,  as  may  give  them  that  rank  in  society,  which 
so  important  a  trust  requires.” 


DIFFERENCES  OF  WAGES 


375 


The  superiority  of  reward  is  not  here  the  consequence  of 
competition,  but  of  its  absence ;  not  a  compensation  for  disad¬ 
vantages  inherent  in  the  employment,  but  an  extra  advantage ; 
a  kind  of  monopoly  price,  the  effect  not  of  a  legal,  but  of  what 
has  been  termed  a  natural  monopoly.  If  all  laborers  were  trust¬ 
worthy  it  would  not  be  necessary  to  give  extra  pay  to  working 
goldsmiths  on  account  of  the  trust.  The  degree  of  integrity 
required  being  supposed  to  be  uncommon,  those  who  can 
make  it  appear  that  they  possess  it  are  able  to  take  advantage 
of  the  peculiarity,  and  obtain  higher  pay  in  proportion  to  its 
rarity.  This  opens  a  class  of  considerations  which  Adam 
Smith,  and  most  other  political  economists,  have  taken  into 
far  too  little  account,  and  from  inattention  to  which,  he  has 
given  a  most  imperfect  exposition  of  the  wide  difference  be¬ 
tween  the  remuneration  of  common  labor  and  that  of  skilled 
employments. 

Some  employments  require  a  much  longer  time  to  learn, 
and  a  much  more  expensive  course  of  instruction  than  others ; 
and  to  this  extent  there  is,  as  explained  by  Adam  Smith,  an  in¬ 
herent  reason  for  their  being  more  highly  remunerated.  If 
an  artisan  must  work  several  years  at  learning  his  trade  before 
he  can  earn  anything,  and  several  years  more  before  becoming 
sufficiently  skilful  for  its  finer  operations,  he  must  have  a  pros¬ 
pect  of  at  last  earning  enough  to  pay  the  wages  of  all  this  past 
labor,  with  compensation  for  the  delay  of  payment,  and  an 
indemnity  for  the  expenses  of  his  education.  His  wages,  con¬ 
sequently,  must  yield,  over  and  above  the  ordinary  amount, 
an  annuity  sufficient  to  repay  these  sums,  with  the  common 
rate  of  profit,  within  the  number  of  years  he  can  expect  to  live 
and  be  in  working  condition.  This,  which  is  necessary  to  place 
the  skilled  employments,  all  circumstances  taken  together,  on 
the  same  level  of  advantage  with  the  unskilled,  is  the  smallest 
difference  which  can  exist  for  any  length  of  time  between  the 
two  remunerations,  since  otherwise  no  one  would  learn  the 
skilled  employments.  And  this  amount  of  difference  is  all 
which  Adam  Smith’s  principles  account  for.  When  the  dis¬ 
parity  is  greater,  he  seems  to  think  that  it  must  be  explained  by 
apprentice  laws,  and  the  rules  of  corporations,  which  restrict 
admission  into  many  of  the  skilled  employments.  But,  inde¬ 
pendently  of  these  or  any  other  artificial  monopolies,  there  is  a 
natural  monopoly  in  favor  of  skilled  laborers  against  the  un- 


376 


POLITICAL  ECONOMY 


skilled,  which  makes  the  difference  of  reward  exceed,  some¬ 
times  in  a  manifold  proportion,  what  is  sufficient  merely  to 
equalize  their  advantages.  If  unskilled  laborers  had  it  in  their 
power  to  compete  with  skilled,  by  merely  taking  the  trouble 
of  learning  the  trade,  the  difference  of  wages  might  not  exceed 
what  would  compensate  them  for  that  trouble,  at  the  ordinary 
rate  at  which  labor  is  remunerated.  But  the  fact  that  a  course 
of  instruction  is  required,  of  even  a  low  degree  of  costliness,  or 
that  the  laborer  must  be  maintained  for  a  considerable  time 
from  other  sources,  suffices  everywhere  to  exclude  the  great 
body  of  the  laboring  people  from  the  possibility  of  any  such 
competition.  Until  lately,  all  employments  which  required 
even  the  humble  education  of  reading  and  writing,  could  be 
recruited  only  from  a  select  class,  the  majority  having  had  no 
opportunity  of  acquiring  those  attainments.  All  such  employ¬ 
ments,  accordingly,  were  immensely  overpaid,  as  measured  by 
the  ordinary  remuneration  of  labor.  Since  reading  and  writ¬ 
ing  have  been  brought  within  the  reach  of  a  multitude,  the 
monopoly  price  of  the  lower  grade  of  educated  employments 
has  greatly  fallen,  the  competition  for  them  having  increased 
in  an  almost  incredible  degree.  There  is  still,  however,  a  much 
greater  disparity  than  can  be  accounted  for  on  the  principle  of 
competition.  A  clerk  from  whom  nothing  is  required  but  the 
mechanical  labor  of  copying,  gains  more  than  an  equivalent  for 
his  mere  exertion  if  he  receives  the  wages  of  a  bricklayer’s 
laborer.  His  work  is  not  a  tenth  part  as  hard,  it  is  quite  as  easy 
to  learn,  and  his  condition  is  less  precarious,  a  clerk’s  place  be¬ 
ing  generally  a  place  for  life.  The  higher  rate  of  his  remunera¬ 
tion,  therefore,  must  be  partly  ascribed  to  monopoly,  the  small 
degree  of  education  required  being  not  even  yet  so  generally 
diffused  as  to  call  forth  the  natural  number  of  competitors ; 
and  partly  to  the  remaining  influence  of  an  ancient  custom, 
which  requires  that  clerks  should  maintain  the  dress  and 
appearance  of  a  more  highly  paid  class.  In  some  manual  em¬ 
ployments,  requiring  a  nicety  of  hand  which  can  only  be  ac¬ 
quired  by  long  practice,  it  is  difficult  to  obtain  at  any  cost  work¬ 
men  in  sufficient  numbers,  who  are  capable  of  the  most  delicate 
kind  of  work ;  and  the  wages  paid  to  them  are  only  limited  by 
the  price  which  purchasers  are  willing  to  give  for  the  com¬ 
modity  they  produce.  This  is  the  case  with  some  working 
watchmakers,  and  with  the  makers  of  some  astronomical  and 


DIFFERENCES  OF  WAGES 


377 


optical  instruments.  If  workmen  competent  to  such  employ¬ 
ments  were  ten  times  as  numerous  as  they  are,  there  would  be 
purchasers  for  all  which  they  could  make,  not  indeed  at  the 
present  prices,  but  at  those  lower  prices  which  would  be  the 
natural  consequence  of  lower  wages.  Similar  considerations 
apply  in  a  still  greater  degree  to  employments  which  it  is  at¬ 
tempted  to  confine  to  persons  of  a  certain  social  rank,  such  as 
what  are  called  the  liberal  professions ;  into  which  a  person  of 
what  is  considered  too  low  a  class  of  society,  is  not  easily  ad¬ 
mitted,  and  if  admitted,  does  not  easily  succeed. 

So  complete,  indeed,  has  hitherto  been  the  separation,  so 
strongly  marked  the  line  of  demarcation,  between  the  different 
grades  of  laborers,  as  to  be  almost  equivalent  to  a  hereditary 
distinction  of  caste ;  each  employment  being  chiefly  recruited 
from  the  children  of  those  already  employed  in  it,  or  in  employ¬ 
ments  of  the  same  rank  with  it  in  social  estimation,  or  from  the 
children  of  persons  who,  if  originally  of  a  lower  rank,  have  suc¬ 
ceeded  in  raising  themselves  by  their  exertions.  The  liberal 
professions  are  mostly  supplied  by  the  sons  of  either  the  profes¬ 
sional,  or  the  idle  classes :  the  more  highly  skilled  manual  em¬ 
ployments  are  filled  up  from  the  sons  of  skilled  artisans,  or 
the  class  of  tradesmen  who  rank  with  them  :  the  lower  classes  of 
skilled  employments  are  in  a  similar  case;  and  unskilled  la¬ 
borers,  with  occasional  exceptions,  remain  from  father  to  son 
in  their  pristine  condition.  Consequently  the  wages  of  each 
class  have  hitherto  been  regulated  by  the  increase  of  its  own 
population,  rather  than  of  the  general  population  of  the  coun¬ 
try.  If  the  professions  are  overstocked,  it  is  because  the  class 
of  society  from  which  they  have  always  mainly  been  supplied, 
has  greatly  increased  in  number,  and  because  most  of  that  class 
have  numerous  families,  and  bring  up  some  at  least  of  their 
sons  to  professions.  If  the  wages  of  artisans  remain  so  much 
higher  than  those  of  common  laborers,  it  is  because  artisans 
are  a  more  prudent  class,  and  do  not  marry  so  early  or  so  in¬ 
considerately.  The  changes,  however,  now  so  rapidly  taking 
place  in  usages  and  ideas,  are  undermining  all  these  distinc¬ 
tions  ;  the  habits  or  disabilities  which  chained  people  to  their 
hereditary  condition  are  fast  wearing  away,  and  every  class  is 
exposed  to  increased  and  increasing  competition  from  at  least 
the  class  immediately  below  it.  The  general  relaxation  of  con¬ 
ventional  barriers,  and  the  increased  facilities  of  education 


378 


POLITICAL  ECONOMY 


which  already  are,  and  will  be  in  a  much  greater  degree, 
brought  within  the  reach  of  all,  tend  to  produce,  among  many 
excellent  effects,  one  which  is  the  reverse ;  they  tend  to  bring 
down  the  wages  of  skilled  labor.  The  inequality  of  remunera¬ 
tion  between  the  skilled  and  the  unskilled  is,  without  doubt, 
very  much  greater  than  is  justifiable;  but  it  is  desirable  that 
this  should  be  corrected  by  raising  the  unskilled,  not  by  lower¬ 
ing  the  skilled.  If,  however,  the  other  changes  taking  place 
in  society  are  not  accompanied  by  a  strengthening  of  the 
checks  to  population  on  the  part  of  laborers  generally,  there 
will  be  a  tendency  to  bring  the  lower  grades  of  skilled  laborers 
under  the  influence  of  a  rate  of  increase  regulated  by  a  lower 
standard  of  living  than  their  own,  and  thus  to  deteriorate  their 
condition  without  raising  that  of  the  general  mass ;  the  stim¬ 
ulus  given  to  the  multiplication  of  the  lowest  class  being  suffi¬ 
cient  to  fill  up  without  difficulty  the  additional  space  gained  by 
them  from  those  immediately  above. 

§  3.  A  modifying  circumstance  still  remains  to  be  noticed, 
which  interferes  to  some  extent  with  the  operation  of  the  prin¬ 
ciples  thus  far  brought  to  view.  While  it  is  true,  as  a  general 
rule,  that  the  earnings  of  skilled  labor,  and  especially  of  any 
labor  which  requires  school  education,  are  at  a  monopoly  rate, 
from  the  impossibility,  to  the  mass  of  the  people,  of  obtaining 
that  education ;  it  is  also  true  that  the  policy  of  nations,  or  the 
bounty  of  individuals,  formerly  did  much  to  counteract  the 
effect  of  this  limitation  of  competition  by  offering  eleemosynary 
instruction  to  a  much  larger  class  of  persons  than  could  have 
obtained  the  same  advantages  by  paying  their  price.  Adam 
Smith  has  pointed  out  the  operation  of  this  cause  in  keeping 
down  the  remuneration  of  scholarly  or  bookish  occupations 
generally,  and  in  particular  of  clergymen,  literary  men,  and 
schoolmasters,  or  other  teachers  of  youth.  I  cannot  better  set 
forth  this  part  of  the  subject  than  in  his  words : 

“  It  has  been  considered  as  of  so  much  importance  that  a 
proper  number  of  young  people  should  be  educated  for  certain 
professions,  that  sometimes  the  public,  and  sometimes  the  piety 
of  private  founders,  have  established  many  pensions,  scholar¬ 
ships,  exhibitions,  bursaries,  etc.,  for  this  purpose,  which  draw 
many  more  people  into  those  trades  than  could  otherwise  pre¬ 
tend  to  follow  them.  In  all  Christian  countries,  I  believe,  the 
education  of  the  greater  part  of  churchmen  is  paid  for  in  this 


DIFFERENCES  OF  WAGES 


379 


manner.  Very  few  of  them  are  educated  altogether  at  their 
own  expense.  The  long,  tedious,  and  expensive  education, 
therefore,  of  those  who  are,  will  not  always  procure  them  a 
suitable  reward,  the  church  being  crowded  with  people  who, 
in  order  to  get  employment,  are  willing  to  accept  of  a  much 
smaller  recompense  than  what  such  an  education  would  other¬ 
wise  have  entitled  them  to ;  and  in  this  manner  the  competition 
of  the  poor  takes  away  the  reward  of  the  rich.  It  would  be 
indecent,  no  doubt,  to  compare  either  a  curate  or  a  chaplain 
with  a  journeyman  in  any  common  trade.  The  pay  of  a  curate 
or  a  chaplain,  however,  may  very  properly  be  considered  as  of 
the  same  nature  with  the  wages  of  a  journeyman.  They  are,  all 
three,  paid  for  their  work  according  to  the  contract  which  they 
may  happen  to  make  with  their  respective  superiors.  Till  after 
the  middle  of  the  fourteenth  century,  five  marks,  containing 
as  much  silver  as  ten  pounds  of  our  present  money,  was  in  Eng¬ 
land  the  usual  pay  of  a  curate  or  a  stipendiary  parish  priest,  as 
we  find  it  regulated  by  the  decrees  of  several  different  national 
councils.  At  the  same  period  fourpence  a  day,  containing  the 
same  quantity  of  silver  as  a  shilling  of  our  present  money,  was 
declared  to  be  the  pay  of  a  master-mason,  and  threepence  a 
day,  equal  to  ninepence  of  cur  present  money,  that  of  a  journey¬ 
man  mason.*  The  wages  of  both  these  laborers,  therefore, 
supposing  them  to  have  been  constantly  employed,  were  much 
superior  to  those  of  the  curate.  The  wages  of  the  master- 
mason,  supposing  him  to  have  been  without  employment  one- 
third  of  the  year,  would  have  fully  equalled  them.  By  the  12th 
of  Queen  Anne,  c.  12,  it  is  declared  ‘  That  whereas  for  want  of 
sufficient  maintenance  and  encouragement  to  curates,  the 
cures  have  in  several  places  been  meanly  supplied,  the  bishop 
is  therefore  empowered  to  appoint  by  writing  under  his  hand 
and  seal  a  sufficient  certain  stipend  or  allowance,  not  exceeding 
fifty,  and  not  less  than  twenty  pounds  a  year/  Forty  pounds 
a  year  is  reckoned  at  present  very  good  pay  for  a  curate,  and 
notwithstanding  this  act  of  parliament,  there  are  many  cura¬ 
cies  under  twenty  pounds  a  year.  This  last  sum  does  not  ex¬ 
ceed  what  is  frequently  earned  by  common  laborers  in  many 
country  parishes.  Whenever  the  law  has  attempted  to  regulate 
the  wages  of  workmen,  it  has  always  been  rather  to  lower  them 
than  to  raise  them.  But  the  law  has  upon  many  occasions  at- 

*  See  the  Statute  of  Laborers,  25  Edw.  III. 


38° 


POLITICAL  ECONOMY 


tempted  to  raise  the  wages  of  curates,  and  for  the  dignity  of 
the  Church,  to  oblige  the  rectors  of  parishes  to  give  them  more 
than  the  wretched  maintenance  which  they  themselves  might 
be  willing  to  accept  of.  And  in  both  cases  the  law  seems  to 
have  been  equally  ineffectual,  and  has  never  been  either  able 
to  raise  the  wages  of  curates  or  to  sink  those  of  laborers  to  the 
degree  that  was  intended,  because  it  has  never  been  able  to 
hinder  either  the  one  from  being  willing  to  accept  of  less  than 
the  legal  allowance,  on  account  of  the  indigence  of  their  situa¬ 
tion  and  the  multitude  of  their  competitors ;  or  the  other  from 
receiving  more,  on  account  of  the  contrary  competition  of  those 
who  expected  to  derive  either  profit  or  pleasure  from  employ¬ 
ing  them.” 

“  In  professions  in  which  there  are  no  benefices,  such  as  law  (?) 
and  physic,  if  an  equal  proportion  of  people  were  educated 
at  the  public  expense,  the  competition  would  soon  be  so  great 
as  to  sink  very  much  their  pecuniary  reward.  It  might  then 
not  be  worth  any  man’s  while  to  educate  his  son  to  either  of 
those  professions  at  his  own  expense.  They  would  be  entirely 
abandoned  to  such  as  had  been  educated  by  those  public  char¬ 
ities  :  whose  numbers  and  necessities  would  oblige  them  in 
general  to  content  themselves  with  a  very  miserable  recom¬ 
pense. 

“  That  unprosperous  race  of  men,  commonly  called  men  of 
letters,  are  pretty  much  in  the  situation  which  lawyers  and 
physicians  probably  would  be  in  upon  the  foregoing  supposi¬ 
tion.  In  every  part  of  Europe,  the  greater  part  of  them  have 
been  educated  for  the  church,  but  have  been  hindered  by  dif¬ 
ferent  reasons  from  entering  into  holy  orders.  They  have  gen¬ 
erally,  therefore,  been  educated  at  the  public  expense,  and  their 
numbers  are  everywhere  so  great  as  to  reduce  the  price  of 
their  labor  to  a  very  paltry  recompense. 

“  Before  the  invention  of  the  art  of  printing,  the  only  em¬ 
ployment  by  which  a  man  of  letters  could  make  anything  by 
his  talents,  was  that  of  a  public  or  private  teacher,  or  by  com¬ 
municating  to  other  people  the  curious  and  useful  knowledge 
which  he  had  acquired  himself :  and  this  is  still  surely  a  more 
honorable,  a  more  useful,  and  in  general  even  a  more  profitable 
employment  than  that  other  of  writing  for  a  bookseller,  to 
which  the  art  of  printing  has  given  occasion.  The  time  and 
study,  the  genius,  knowledge,  and  application  requisite  to 


DIFFERENCES  OF  WAGES 


38i 


qualify  an  eminent  teacher  of  the  sciences,  are  at  least  equal  to 
what  is  necessary  for  the  greatest  practitioners  in  law  and 
physic.  But  the  usual  reward  of  the  eminent  teacher  bears  no 
proportion  to  that  of  the  lawyer  or  physician ;  because  the  trade 
of  the  one  is  crowded  with  indigent  people  who  have  been 
brought  up  to  it  at  the  public  expense,  whereas  those  of  the 
other  two  are  encumbered  with  very  few  who  have  not  been 
educated  at  their  own.  The  usual  recompense,  however,  of 
public  and  private  teachers,  small  as  it  may  appear,  would  un¬ 
doubtedly  be  less  than  it  is,  if  the  competition  of  those  yet  more 
indigent  men  of  letters  who  write  for  bread  was  not  taken  out 
of  the  market.  Before  the  invention  of  the  art  of  printing,  a 
scholar  and  a  beggar  seem  to  have  been  terms  very  nearly 
synonymous.  The  different  governors  of  the  universities  be¬ 
fore  that  time  appear  to  have  often  granted  licenses  to  their 
scholars,  to  beg.” 

§  4.  The  demand  for  literary  labor  has  so  greatly  increased 
since  Adam  Smith  wrote,  while  the  provisions  for  eleemosynary 
education  have  nowhere  been  much  added  to,  and  in  the  coun¬ 
tries  which  have  undergone  revolutions  have  been  much  dimin¬ 
ished,  that  little  effect  in  keeping  down  the  recompense  of 
literary  labor  can  now  be  ascribed  to  the  influence  of  those 
institutions.  But  an  effect  nearly  equivalent  is  now  produced 
by  a  cause  somewhat  similar — the  competition  of  persons  who, 
by  analogy  with  other  arts,  may  be  called  amateurs.  Literary 
occupation  is  one  of  those  pursuits  in  which  success  may  be 
attained  by  persons  the  greater  part  of  whose  time  is  taken 
up  by  other  employments ;  and  the  education  necessary  for 
it,  is  the  common  education  of  all  cultivated  persons.  The 
inducements  to  it,  independently  of  money,  in  the  present  state 
of  the  world,  to  all  who  have  either  vanity  to  gratify,  or  per¬ 
sonal  or  public  objects  to  promote,  are  strong.  These  motives 
now  attract  into  this  career  a  great  and  increasing  number  of 
persons  who  do  not  need  its  pecuniary  fruits,  and  who  would 
equally  resort  to  it  if  it  afforded  no  remuneration  at  all.  In  our 
own  country  (to  cite  known  examples),  the  most  influential, 
and  on  the  whole  most  eminent  philosophical  writer  of  recent 
times  (Bentham),  the  greatest  political  economist  (Ricardo), 
the  most  ephemerally  celebrated,  and  the  really  greatest  poets 
(Byron  and  Shelley),  and  the  most  successful  writer  of  prose 
fiction  (Scott),  were  none  of  them  authors  by  profession ;  and 


382 


POLITICAL  ECONOMY 


only  two  of  the  five,  Scott  and  Byron,  could  have  supported 
themselves  by  the  works  which  they  wrote.  Nearly  all  the  high 
departments  of  authorship  are,  to  a  great  extent,  similarly 
filled.  In  consequence,  although  the  highest  pecuniary  prizes 
of  successful  authorship  are  incomparably  greater  than  at  any 
former  period,  yet  on  any  rational  calculation  of  the  chances, 
in  the  existing  competition,  scarcely  any  writer  can  hope  to 
gain  a  living  by  books,  and  to  do  so  by  magazines  and  reviews 
becomes  daily  more  difficult.  It  is  only  the  more  troublesome 
and  disagreeable  kinds  of  literary  labor,  and  those  which  con¬ 
fer  no  personal  celebrity,  such  as  most  of  those  connected  with 
newspapers,  or  with  the  smaller  periodicals,  on  which  an  edu¬ 
cated  person  can  now  rely  for  subsistence.  Of  these,  the  re¬ 
muneration  is,  on  the  whole,  decidedly  high ;  because,  though 
exposed  to  the  competition  of  what  used  to  be  called  “  poor 
scholars  ”  (persons  who  have  received  a  learned  education 
from  some  public  or  private  charity),  they  are  exempt  from  that 
of  amateurs,  those  who  have  other  means  of  support  being 
seldom  candidates  for  such  employments.  Whether  these  con¬ 
siderations  are  not  connected  with  something  radically  amiss 
in  the  idea  of  authorship  as  a  profession,  and  whether  any  so¬ 
cial  arrangement  under  which  the  teachers  of  mankind  con¬ 
sist  of  persons  giving  out  doctrines  for  bread,  is  suited  to  be, 
or  can  possibly  be,  a  permanent  thing — would  be  a  subject  well 
worthy  of  the  attention  of  thinkers. 

The  clerical,  like  the  literary  profession,  is  frequently  adopted 
by  persons  of  independent  means,  either  from  religious  zeal, 
or  for  the  sake  of  the  honor  or  usefulness  which  may  belong 
to  it,  or  for  a  chance  of  the  high  prizes  which  it  holds  out ;  and 
it  is  now  principally  for  this  reason  that  the  salaries  of  curates 
are  so  low;  those  salaries,  though  considerably  raised  by  the 
influence  of  public  opinion,  being  still  generally  insufficient  as 
the  sole  means  of  support  for  one  who  has  to  maintain  the  ex¬ 
ternals  expected  from  a  clergyman  of  the  established  church. 

When  an  occupation  is  carried  on  chiefly  by  persons  who 
derive  the  main  portion  of  their  subsistence  from  other  sources, 
its  remuneration  may  be  lower  almost  to  any  extent,  than  the 
wages  of  equally  severe  labor  in  other  employments.  The 
principal  example  of  the  kind  is  domestic  manufactures.  When 
spinning  and  knitting  were  carried  on  in  every  cottage,  by  fam¬ 
ilies  deriving  their  principal  support  from  agriculture,  the  price 


DIFFERENCES  OF  WAGES 


383 


at  which  their  produce  was  sold  (which  constituted  the  remu¬ 
neration  of  the  labor)  was  often  so  low,  that  there  would  have 
been  required  great  perfection  of  machinery  to  undersell  it. 
The  amount  of  the  remuneration  in  such  a  case,  depends 
chiefly  upon  whether  the  quantity  of  the  commodity,  produced 
by  this  description  of  labor,  suffices  to  supply  the  whole  of  the 
demand.  If  it  does  not,  and  there  is  consequently  a  necessity 
for  some  laborers  who  devote  themselves  entirely  to  the  em¬ 
ployment,  the  price  of  the  article  must  be  sufficient  to  pay 
those  laborers  at  the  ordinary  rate,  and  to  reward  therefore 
very  handsomely  the  domestic  producers.  But  if  the  demand 
is  so  limited  that  the  domestic  manufacture  can  do  more  than 
satisfy  it,  the  price  is  naturally  kept  down  to  the  lowest  rate  at 
which  peasant  families  think  it  worth  while  to  continue  the 
production.  It  is,  no  doubt,  because  the  Swiss  artisans  do  not 
depend  for  the  whole  of  their  subsistence  upon  their  looms, 
that  Zurich  is  able  to  maintain  a  competition  in  the  European 
market  with  English  capital,  and  English  fuel  and  machinery.* 
Thus  far,  as  to  the  remuneration  of  the  subsidiary  employ¬ 
ment  ;  but  the  effect  to  the  laborers  of  having  this  additional 
resource,  is  almost  certain  to  be  (unless  peculiar  counteracting 
causes  intervene)  a  proportional  diminution  of  the  wages  of 
their  main  occupation.  The  habits  of  the  people  (as  has  already 
been  so  often  remarked)  everywhere  require  some  particular 
scale  of  living,  and  no  more,  as  the  condition  without  which 
they  will  not  bring  up  a  family.  Whether  the  income  which 
maintains  them  in  this  condition  comes  from  one  source  or 
from  two,  makes  no  difference:  if  there  is  a  second  source  of 
income,  they  require  less  from  the  first ;  and  multiply  (at  least 
this  has  always  hitherto  been  the  case)  to  a  point  which  leaves 
them  no  more  from  both  employments  than  they  would  prob¬ 
ably  have  had  from  either  if  it  had  been  their  sole  occupation. 

For  the  same  reason  it  is  found  that,  cccteris  paribus,  those 
trades  are  generally  the  worst  paid,  in  which  the  wife  and  chil¬ 
dren  of  the  artisan  aid  in  the  work.  The  income  which  the 
habits  of  the  class  demand,  and  down  to  which  they  are  almost 
sure  to  multiply,  is  made  up,  in  those  trades,  by  the  earnings 
of  the  whole  family,  while  in  others  the  same  income  must  be 

*  Four-fifths  of  the  manufacturers  of  a  tenth  part  of  the  population;  and  they 
the  Canton  of  Zurich  are  small  farmers,  consume  a  greater  quantity  of  cotton 
generally  proprietors  of  their  farms.  The  per  inhabitant  than  either  France  or 
cotton  manufacture  occupies  either  England.  See  the  Statistical  Account  of 
wholly  or  partially  23,000  people,  nearly  Zurich,  formerly  cited,  pp.  105,  108,  no. 


384 


POLITICAL  ECONOMY 


obtained  by  the  labor  of  the  man  alone.  It  is  even  probable 
that  their  collective  earnings  will  amount  to  a  smaller  sum 
than  those  of  the  man  alone  in  other  trades ;  because  the  pru¬ 
dential  restraint  on  marriage  is  unusually  weak  when  the  only 
consequence  immediately  felt  is  an  improvement  of  circum¬ 
stances,  the  joint  earnings  of  the  two  going  further  in  their 
domestic  economy  after  marriage  than  before.  Such  accord¬ 
ingly  is  the  fact,  in  the  case  of  hand-loom  weavers.  In  most 
kinds  of  weaving,  women  can  and  do  earn  as  much  as  men, 
and  children  are  employed  at  a  very  early  age;  but  the  ag¬ 
gregate  earnings  of  a  family  are  lower  than  in  almost  any  other 
kind  of  industry,  and  the  marriages  earlier.  It  is  noticeable 
also  that  there  are  certain  branches  of  hand-loom  weaving  in 
which  wages  are  much  above  the  rate  common  in  the  trade,  and 
that  these  are  the  branches  in  which  neither  women  nor  young 
persons  are  employed.  These  facts  were  authenticated  by  the 
inquiries  of  the  Hand-loom  Weavers  Commission,  which  made 
its  report  in  1841.  No  argument  can  be  hence  derived  for  the 
exclusion  of  women  from  the  liberty  of  competing  in  the  labor 
market ;  since  even  when  no  more  is  earned  by  the  labor  of  a 
man  and  a  woman  than  would  have  been  earned  by  the  man 
alone,  the  advantage  to  the  woman  of  not  depending  on  a  mas¬ 
ter  for  subsistence  may  be  more  than  an  equivalent.  It  can¬ 
not,  however,  he  considered  desirable  as  a  permanent  element 
in  the  condition  of  a  laboring  class,  that  the  mother  of  the  fam¬ 
ily  (the  case  of  single  women  is  totally  different)  should  be 
under  the  necessity  of  working  for  subsistence,  at  least  else¬ 
where  than  in  their  place  of  abode.  In  the  case  of  children, 
who  are  necessarily  dependent,  the  influence  of  their  competi¬ 
tion  in  depressing  the  labor  market  is  an  important  element  in 
the  question  of  limiting  their  labor,  in  order  to  provide  better 
for  their  education. 

§  5.  It  deserves  consideration,  why  the  wages  of  women  are 
generally  lower,  and  very  much  lower,  than  those  of  men. 
They  are  not  universally  so.  Where  men  and  women  work  at 
the  same  employment,  if  it  be  one  for  which  they  are  equally 
fitted  in  point  of  physical  power,  they  are  not  always  unequally 
paid.  Women,  in  factories,  sometimes  earn  as  much  as  men: 
and  so  they  do  in  hand-loom  weaving,  which,  being  paid  by 
the  piece,  brings  their  efficiency  to  a  sure  test.  When  the 
efficiency  is  equal,  but  the  pay  unequal,  the  only  explanation 


DIFFERENCES  OF  WAGES  385 

that  can  be  given  is  custom  ;  grounded  either  in  a  prejudice, 
or  in  the  present  constitution  of  society,  which,  making  almost 
every  woman,  socially  speaking,  an  appendage  of  some  man, 
enables  men  to  take  systematically  the  lion’s  share  of  whatever 
belongs  to  both.  But  the  principal  question  relates  to  the 
peculiar  employments  of  women.  The  remuneration  of  these 
is  always,  I  believe,  greatly  below  that  of  employments  of  equal 
skill  and  equal  disagreeableness,  carried  on  by  men.  In  some 
of  these  cases  the  explanation  is  evidently  that  already  given : 
as  in  the  case  of  domestic  servants,  whose  wages,  speaking 
generally,  are  not  determined  by  competition,  but  are  greatly 
in  excess  of  the  market  value  of  the  labor,  and  in  this  excess, 
as  in  almost  all  things  which  are  regulated  by  custom,  the  male 
sex  obtains  by  far  the  largest  share.  In  the  occupations  in 
which  employers  take  full  advantage  of  competition,  the  low 
wages  of  women  as  compared  with  the  ordinary  earnings  of 
men,  are  a  proof  that  the  employments  are  overstocked :  that 
although  so  much  smaller  a  number  of  women,  than  of  men, 
support  themselves  by  wages,  the  occupations  which  law  and 
usage  make  accessible  to  them  are  comparatively  so  few,  that 
the  field  of  their  employment  is  still  more  over-crowded.  It 
must  be  observed,  that  as  matters  now  stand,  a  sufficient  degree 
of  overcrowding  may  depress  the  wages  of  women  to  a  much 
lower  minimum  than  those  of  men.  The  wages,  at  least  of 
single  women,  must  be  equal  to  their  support ;  but  need  not  be 
more  than  equal  to  it ;  the  minimum,  in  their  case,  is  the  pit¬ 
tance  absolutely  requisite  for  the  sustenance  of  one  human 
being.  Now  the  lowest  point  to  which  the  most  superabundant 
competition  can  permanently  depress  the  wages  of  a  man,  is 
always  somewhat  more  than  this.  Where  the  wife  of  a  labor¬ 
ing  man  does  not  by  general  custom  contribute  to  his  earn¬ 
ings,  the  man’s  wages  must  be  at  least  sufficient  to  support 
himself,  a  wife,  and  a  number  of  children  adequate  to  keep 
up  the  population,  since  if  it  were  less,  the  population  would 
not  be  kept  up.  And  even  if  the  wife  earns  something,  their 
joint  wages  must  be  sufficient  to  support,  not  only  themselves, 
but  (at  least  for  some  years)  their  children  also.  The  ne  plus 
ultra  of  low  wages,  therefore,  (except  during  some  transitory 
crisis,  or  in  some  decaying  employment,)  can  hardly  occur  in 
any  occupation  which  the  person  employed  has  to  live  by, 
except  the  occupations  of  women. 

Vol.  I. — 25 


386 


POLITICAL  ECONOMY 


§  6.  Thus  far,  we  have,  through  this  discussion,  proceeded 
on  the  supposition  that  competition  is  free,  so  far  as  regards 
human  interference ;  being  limited  only  by  natural  causes,  or 
by  the  unintended  effect  of  general  social  circumstances.  But 
law  or  custom  may  interfere  to  limit  competition.  If  appren¬ 
tice  laws,  or  the  regulations  of  corporate  bodies,  make  the  ac¬ 
cess  to  a  particular  employment  slow,  costly,  or  difficult,  the 
wages  of  that  employment  may  be  kept  much  above  their 
natural  proportion  to  the  wages  of  common  labor.  They  might 
be  so  kept  without  any  assignable  limit,  were  it  not  that  wages 
which  exceed  the  usual  rate  require  corresponding  prices,  and 
that  there  is  a  limit  to  the  price  at  which  even  a  restricted  num¬ 
ber  of  producers  can  dispose  of  all  they  produce.  In  most 
civilized  countries,  the  restrictions  of  this  kind  which  once  ex¬ 
isted  have  been  either  abolished  or  very  much  relaxed,  and  will, 
no  doubt,  soon  disappear  entirely.  In  some  trades,  however, 
and  to  some  extent,  the  combinations  of  workmen  produce  a 
similar  effect.  Those  combinations  always  fail  to  uphold  wages 
at  an  artificial  rate,  unless  they  also  limit  the  number  of  com¬ 
petitors.  But  they  do  occasionally  succeed  in  accomplishing 
this.  In  several  trades  the  workmen  have  been  able  to  make  it 
almost  impracticable  for  strangers  to  obtain  admission  either 
as  journeymen  or  as  apprentices,  except  in  limited  numbers, 
and  under  such  restrictions  as  they  choose  to  impose.  It  was 
given  in  evidence  to  the  Hand-loom  Weavers  Commission, 
that  this  is  one  of  the  hardships  which  aggravate  the  grievous 
condition  of  that  depressed  class.  Their  own  employment  is 
overstocked  and  almost  ruined ;  but  there  are  many  other 
trades  which  it  would  not  be  difficult  for  them  to  learn  :  to  this, 
however,  the  combinations  of  workmen  in  those  other  trades 
are  said  to  interpose  an  obstacle  hitherto  insurmountable. 

Notwithstanding,  however,  the  cruel  manner  in  which  the 
exclusive  principle  of  these  combinations  operates  in  a  case 
of  this  peculiar  nature,  the  question,  whether  they  are  on  the 
whole  more  useful  or  mischievous,  requires  to  be  decided  on  an 
enlarged  consideration  of  consequences,  among  which  such  a 
fact  as  this  is  not  one  of  the  most  important  items.  Putting 
aside  the  atrocities  sometimes  committed  bv  workmen  in  the 
way  of  personal  outrage  or  intimidation,  which  cannot  be  too 
rigidly  repressed ;  if  the  present  state  of  the  general  habits  of 
the  people  were  to  remain  forever  unimproved,  these  partial 


DIFFERENCES  OF  WAGES 


387 


combinations,  in  so  far  as  they  do  succeed  in  keeping  up  the 
wages  of  any  trade  by  limiting  its  numbers,  might  be  looked 
upon  as  simply  intrenching  round  a  particular  spot  against  the 
inroads  of  over-population,  and  making  the  wages  of  the  class 
depend  upon  their  own  rate  of  increase,  instead  of  depending 
on  that  of  a  more  reckless  and  improvident  class  than  them¬ 
selves.  What  at  first  sight  seems  the  injustice  of  excluding 
the  more  numerous  body  from  sharing  the  gains  of  a  compara¬ 
tively  few,  disappears  when  we  consider  that  by  being  ad¬ 
mitted,  they  would  not  be  made  better  off,  for  more  than  a  short 
time ;  the  only  permanent  effect  which  their  admission  would 
produce,  would  be  to  lower  the  others  to  their  own  level.  To 
what  extent  the  force  of  this  consideration  is  annulled  when  a 
tendency  commences  towards  diminished  over-crowding  in  the 
laboring  classes  generally,  and  what  grounds  of  a  different 
nature  there  may  be  for  regarding  the  existence  of  trade  com¬ 
binations  as  rather  to  be  desired  than  deprecated,  will  be  con¬ 
sidered  in  a  subsequent  chapter  of  this  work,  with  the  subject 
of  Combination  Laws. 

§  7.  To  conclude  this  subject,  I  must  repeat  an  observation 
already  made,  that  there  are  kinds  of  labor  of  which  the  wages 
are  fixed  by  custom,  and  not  by  competition.  Such  are  the 
fees  or  charges  of  professional  persons :  of  physicians,  sur¬ 
geons,  barristers,  and  even  attorneys.  These,  as  a  general  rule, 
do  not  vary,  and  though  competition  operates  upon  those 
classes  as  much  as  upon  any  others,  it  is  by  dividing  the  busi¬ 
ness,  not,  in  general,  by  diminishing  the  rate  at  which  it  is  paid. 
The  cause  of  this,  perhaps,  has  been  the  prevalence  of  an  opin¬ 
ion  that  such  persons  are  more  trustworthy  if  paid  highly  in 
proportion  to  the  work  they  perform ;  insomuch  that  if  a  law¬ 
yer  or  a  physician  offered  his  services  at  less  than  the  ordi¬ 
nary  rate,  instead  of  gaining  more  practice,  he  would  probably 
lose  that  which  he  already  had.  For  analogous  reasons  it  is 
usual  to  pay  greatly  beyond  the  market  price  of  their  labor, 
all  persons  in  whom  the  employer  wishes  to  place  peculiar 
trust,  or  from  whom  he  requires  something  besides  their  mere 
services.  For  example,  most  persons  who  can  afford  it,  pay  to 
their  domestic  servants  higher  wages  than  would  purchase  in 
the  market  the  labor  of  persons  fully  as  competent  to  the  work 
required.  They  do  this,  not  merely  from  ostentation,  but  also 
from  more  reasonable  motives ;  either  because  they  desire  that 


388 


POLITICAL  ECONOMY 


those  they  employ  should  serve  them  cheerfully,  and  be  anx¬ 
ious  to  remain  in  their  service ;  or  because  they  do  not  like  to 
drive  a  hard  bargain  with  people  whom  they  are  in  constant 
intercourse  with ;  or  because  they  dislike  to  have  near  their 
persons,  and  continually  in  their  sight,  people  with  the  appear¬ 
ance  and  habits  which  are  the  usual  accompaniments  of  a  mean 
remuneration.  Similar  feelings  operate  in  the  minds  of  per¬ 
sons  in  business,  with  respect  to  their  clerks  and  other  em¬ 
ployees.  Liberality,  generosity,  and  the  credit  of  the  employer, 
are  motives  which,  to  whatever  extent  they  operate,  preclude 
taking  the  utmost  advantage  of  competition :  and  doubtless 
such  motives  might,  and  even  now  do,  operate  on  employers 
of  labor  in  all  the  great  departments  of  industry ;  and  most 
desirable  is  it  that  they  should.  But  they  can  never  raise  the 
average  wages  of  labor  beyond  the  ratio  of  population  to  cap¬ 
ital.  By  giving  more  to  each  person  employed,  they  limit  the 
power  of  giving  employment  to  numbers ;  and  however  ex¬ 
cellent  their  moral  effect,  they  do  little  good  economically,  un¬ 
less  the  pauperism  of  those  who  are  shut  out,  leads  indirectly  to 
a  readjustment  by  means  of  an  increased  restraint  on  popula¬ 
tion. 


Chapter  XV. — Of  Profits 

§  i.  Having  treated  of  the  laborer’s  share  of  the  produce,  we 
next  proceed  to  the  share  of  the  capitalist ;  the  profits  of  capital 
or  stock;  the  gains  of  the  person  who  advances  the  expenses 
of  production — who,  from  funds  in  his  possession,  pays  the 
wages  of  the  laborers,  or  supports  them  during  the  work ;  who 
supplies  the  requisite  buildings,  materials,  and  tools  or  machin¬ 
ery;  and  to  whom,  by  the  usual  terms  of  the  contract,  the 
produce  belongs,  to  be  disposed  of  at  his  pleasure.  After  in¬ 
demnifying  him  for  his  outlay,  there  commonly  remains  a  sur¬ 
plus,  which  is  his  profit ;  the  net  income  from  his  capital :  the 
amount  which  he  can  afford  to  expend  in  necessaries  or  pleas¬ 
ures,  or  from  which  by  further  saving  he  can  add  to  his  wealth. 

As  the  wages  of  the  laborer  are  the  remuneration  of  labor, 
so  the  profits  of  the  capitalist  are  properly,  according  to  Mr. 

Senior’s  well-chosen  expression,  the  remuneration  of  abstf- 

nence.,  They  are  what  he  gains  by  forbearing  to  consume  his 

to  be  consumed  by 
is  forbearance  he  re¬ 


capital  for  his  own  uses,  and  allowing  it 
productive  laborers  for  their  uses.  For  th 


PROFITS 


389 


gujres  a  recompense.  Very  often  in  personal  enjoyment  he 
would  be  a  gainer  by  squandering  his  capital,  the  capital 
amounting  to  more  than  the  sum  of  the  profits  which  it  will  yield 
during  the  years  he  can  expect  to  live.  But  while  he  retains 
it  undiminished,  he  has  always  the  power  of  consuming  it  if  he 
wishes  or  needs ;  he  can  bestow  it  upon  others  at  his  death ; 
and  in  the  meantime  he  derives  from  it  an  income,  which  he 
can  without  impoverishment  apply  to  the  satisfaction  of  his 
own  wants  or  inclinations. 

Of  the  gains,  however,  which  the  possession  of  a  capital  en¬ 
ables  a  person  to  make,  a  part  only  is  properly  an  equivalent 
for  the  use  of  the  capital  itself ;  namely,  as  much  as  a  solvent 
person  would  be  willing  to  pay  for  the  loan  of  it.  This,  which 
as  everybody  knows  is  called  interest,  is  all  that  a  person  is 
enabled  to  get  by  merely  abstaining  from  the  immediate  con¬ 
sumption  of  his  capital,  and  allowing  it  to  be  used  for  pro¬ 
ductive  purposes  by  others.  The  remuneration  which  is  ob¬ 
tained  in  any  country  for  mere  abstinence,  is  measured  by  the 
current  rate  of  interest  on  the  best  security ;  such  security  as 
precludes  any  appreciable  chance  of  losing  the  principal.  What 
a  person  expects  to  gain,  who  superintends  the  employment  of 
his  own  capital,  is  always  more,  and  generally  much  more,  than 
this.  The  rate  of  profit  greatly  exceeds  the  rate  of  interest. 
The  surplus  is  partly  compensation  for  risk.  By  lending  his 
capital,  on  unexceptionable  security,  he  runs  little  or  no  risk. 
But  if  he  embarks  in  business  on  his  own  account,  he  always 
exposes  his  capital  to  some,  and  in  many  cases  to  very  great, 
danger  of  partial  or  total  loss.  For  this  danger  he  must  be 
compensated,  otherwise  he  will  not  incur  it.  He  must  likewise 
be  remunerated  for  the  devotion  of  his  time  and  labor.  The 
control  of  the  operations  of  industry  usually  belongs  to  the  per¬ 
son  who  supplies  the  whole  or  the  greatest  part  of  the  funds 
by  which  they  are  carried  on,  and  who,  according  to  the  ordi¬ 
nary  arrangement,  is  either  alone  interested,  or  is  the  person 
most  interested  (at  least  directly),  in  the  result.  To  exercise 
this  control  with  efficiency,  if  the  concern  is  large  and  com¬ 
plicated,  requires  great  assiduity,  and  often,  no  ordinary  skill. 
This  assiduity  and  skill  must  be  remunerated. 

The  gross  profits  from  capital,  the  gains  returned  to  those 
who  supply  the  funds  for  production,  must  suffice  for  these 
three  purposes.  They  must  afford  a  sufficient  equivalent  for 


39° 


POLITICAL  ECONOMY 


abstinence,  indemnity  for  risk,  and  remuneration  for  the  labor 
and  skill  required  for  superintendence.  These  different  com¬ 
pensations  may  be  either  paid  to  the  same,  or  to  different  per¬ 
sons.  The  capital,  or  some  part  of  it,  may  be  borrowed :  may 
belong  to  someone  who  does  not  undertake  the  risks  or  the 
trouble  of  business.  In  that  case,  the  lender,  or  owner,  is  the 
person  who  practices  the  abstinence;  and  is  remunerated  for 
it  by  the  interest  paid  to  him,  while  the  difference  between  the 
interest  and  the  gross  profit  remunerates  the  exertions  and  risks 
of  the  undertaker.*  Sometimes,  again,  the  capital,  or  a  part 
of  it,  is  supplied  by  what  is  called  a  sleeping  partner;  who 
shares  the  risks  of  the  employment,  but  not  the  trouble,  and 
who,  in  consideration  of  those  risks,  receives  not  a  mere  inter¬ 
est,  but  a  stipulated  share  of  the  gross  profits.  Sometimes  the 
capital  is  supplied  and  the  risk  incurred  by  one  person,  and  the 
business  carried  on  exclusively  in  his  name,  while  the  trouble 
of  management  is  made  over  to  another,  who  is  engaged  for 
that  purpose  at  a  fixed  salary.  Management,  however,  by  hired 
servants,  who  have  no  interest  in  the  result  but  that  of  preserv¬ 
ing  their  salaries,  is  proverbially  inefficient,  unless  they  act  un¬ 
der  the  inspecting  eye,  if  not  the  controlling  hand,  of  the  per¬ 
son  chiefly  interested:  and  prudence  almost  always  recom¬ 
mends  giving  to  a  manager  not  thus  controlled,  a  remuneration 
partly  dependent  on  the  profits;  which  virtually  reduces  the 
case  to  that  of  a  sleeping  partner.  Or  finally,  the  same  person 
may  own  the  capital,  and  conduct  the  business ;  adding,  if  he 
will  and  can,  to  the  management  of  his  own  capital,  that  of  as 
much  more  as  the  owners  may  be  willing  to  trust  him  with. 
But  under  any  and  all  of  these  arrangements,  the  same  three 
things  require  their  remuneration,  and  must  obtain  it  from  the 
gross  profit :  abstinence,  risk,  exertion.  And  the  three  parts 
into  which  profit  may  be  considered  as  resolving  itself,  may  be 
described  respectively  as  interest,  insurance,  and  wages  of  super¬ 
intendence. 

§  2.  The  lowest  rate  of  profit  which  can  permanently  exist,  is 
that  which  is  barely  adequate,  at  the  given  place  and  time,  to 
afford  an  equivalent  for  the  abstinence,  risk,  and  exertion  im¬ 
plied  in  the  employment  of  capital.  From  the  gross  profit,  has 
first  to  be  deducted  as  much  as  will  form  a  fund  sufficient  on 

*  It  is  to  be  regretted  that  this  word,  enjoy  a  great  advantage  in  being  able  to 
in  this  sense,  is  not  familiar  to  an  Eng-  speak  currently  of  les  profits  de  Ventre- 
lish  ear.  French  political  economists  preneur. 


PROFITS 


39i 


the  average  to  cover  all  losses  incident  to  the  employment.  Next, 
it  must  afford  such  an  equivalent  to  the  owner  of  the  capital 
for  forbearing  to  consume  it,  as  is  then  and  there  a  sufficient 
motive  to  him  to  persist  in  his  abstinence.  How  much  will  be 
required  to  form  this  equivalent,  depends  on  the  comparative 
value  placed,  in  the  given  society,  upon  the  present  and  the 
future:  (in  the  words  formerly  used)  on  the  strength  of  the 
effective  desire  of  accumulation.  Further,  after  covering  all 
losses,  and  remunerating  the  owner  for  forbearing  to  consume, 
there  must  be  something  left  to  recompense  the  labor  and  skill 
of  the  person  who  devotes  his  time  to  the  business.  This  recom¬ 
pense  too  must  be  sufficient  to  enable  at  least  the  owners  of  the 
larger  capitals  to  receive  for  their  trouble,  or  to  pay  to  some 
manager  for  his,  what  to  them  or  him  will  be  a  sufficient  in¬ 
ducement  for  undergoing  it.  If  the  surplus  is  no  more  than 
this,  none  but  large  masses  of  capital  will  be  employed  pro¬ 
ductively,  and  if  it  did  not  even  amount  to  this,  capital  would 
be  withdrawn  from  production,  and  unproductively  consumed, 
until,  by  an  indirect  consequence  of  its  diminished  amount,  to 
be  explained  hereafter,  the  rate  of  profit  was  raised. 

Such,  then,  is  the  minimum  of  profits :  but  that  minimum  is 
exceedingly  variable,  and  at  some  times  and  places  extremely 
low ;  on  account  of  the  great  variableness  of  two  out  of  its 
three  elements.  That  the  rate  of  necessary  remuneration  for 
abstinence,  or  in  other  words  the  effective  desire  of  accumula¬ 
tion,  differs  widely  in  different  states  of  society  and  civilization, 
has  been  seen  in  a  former  chapter.  There  is  a  still  wider  differ¬ 
ence  in  the  element  which  consists  in  compensation  for  risk. 
I  am  not  now  speaking  of  the  differences  in  point  of  risk  be¬ 
tween  different  employments  of  capital  in  the  same  society,  but 
of  the  very  different  degrees  of  security  of  property  in  different 
states  of  society.  Where,  as  in  many  of  the  governments  of 
Asia,  property  is  in  perpetual  danger  of  spoliation  from  a 
tyrannical  government,  or  from  its  rapacious  and  ill-controlled 
officers ;  where  to  possess  or  to  be  suspected  of  possessing 
wealth,  is  to  be  a  mark  not  only  for  plunder,  but  perhaps  for 
personal  ill-treatment  to  extort  the  disclosure  and  surrender 
of  hidden  valuables ;  or  where,  as  in  the  European  middle  ages, 
the  weakness  of  the  government,  even  when  not  itself  inclined 
to  oppress,  leaves  its  subjects  exposed  without  protection  or 
redress  to  active  spoliation,  or  audacious  withholding  of  just 


392 


POLITICAL  ECONOMY 


rights,  by  any  powerful  individual ;  the  rate  of  profit  which 
persons  of  average  dispositions  will  require,  to  make  them 
forego  the  immediate  enjoyment  of  what  they  happen  to  possess, 
for  the  purpose  of  exposing  it  and  themselves  to  these  perils, 
must  be  something  very  considerable.  And  these  contingencies 
affect  those  who  live  on  the  mere  interest  of  their  capital,  in 
common  with  those  who  personally  engage  in  production.  In 
a  generally  secure  state  of  society,  the  risks  which  may  be  at¬ 
tendant  on  the  nature  of  particular  employments  seldom  fall 
on  the  person  who  lends  his  capital,  if  he  lends  on  good  secur¬ 
ity;  but  in  a  state  of  society  like  that  of  many  parts  of  Asia, 
no  security  (except  perhaps  the  actual  pledge  of  gold  or  jewels) 
is  good :  and  the  mere  possession  of  a  hoard,  when  known  or 
suspected,  exposes  it  and  the  possessor  to  risks,  for  which 
scarcely  any  profit  he  could  expect  to  obtain  would  be  an  equiv¬ 
alent  ;  so  that  there  would  be  still  less  accumulation  than  there 
is,  if  a  state  of  insecurity  did  not  also  multiply  the  occasions 
on  which  the  possession  of  a  treasure  may  be  the  means  of 
saving  life,  or  averting  serious  calamities.  Those  who  lend, 
under  these  wretched  governments,  do  it  at  the  utmost  peril  of 
never  being  paid.  In  most  of  the  native  states  of  India,  the 
lowest  terms  on  which  anyone  will  lend  money,  even  to  the 
government,  are  such,  that  if  the  interest  is  paid  only  for  a 
few  years,  and  the  principal  not  at  all,  the  lender  is  tolerably 
well  indemnified.  If  the  accumulation  of  principal  and  com¬ 
pound  interest  is  ultimately  compromised  at  a  few  shillings  in 
the  pound,  he  has  generally  made  an  advantageous  bargain. 

§  3.  The  remuneration  of  capital  in  different  employments, 
much  more  than  the  remuneration  of  labor,  varies  according  to 
the  circumstances  which  render  one  employment  more  attrac¬ 
tive,  or  more  repulsive,  than  another.  The  profits,  for  example, 
of  retail  trade,  in  proportion  to  the  capital  employed,  exceed 
those  of  wholesale  dealers  or  manufacturers,  for  this  reason 
among  others,  that  there  is  less  consideration  attached  to  the 
employment.  The  greatest,  however,  of  these  differences,  is  that 
caused  by  difference  of  risk.  The  profits  of  a  gunpowder  manu¬ 
facturer  must  be  considerably  greater  than  the  average,  to  make 
up  for  the  peculiar  risks  to  which  he  and  his  property  are  con¬ 
stantly  exposed.  When,  however,  as  in  the  case  of  marine  ad¬ 
venture,  the  peculiar  risks  are  capable  of  being,  and  commonly 
are,  commuted  for  a  fixed  payment,  the  premium  of  insurance 


PROFITS 


393 


takes  its  regular  place  among  the  charges  of  production;  and 
the  compensation  which  the  owner  of  the  ship  or  cargo  receives 
for  that  payment,  does  not  appear  in  the  estimate  of  his  profits, 
but  is  included  in  the  replacement  of  his  capital. 

The  portion,  too,  of  the  gross  profit,  which  forms  the  remuner¬ 
ation  for  the  labor  and  skill  of  the  dealer  or  producer,  is  very 
different  in  different  employments.  This  is  the  explanation  al¬ 
ways  given  of  the  extraordinary  rate  of  apothecaries’  profit;  the 
greatest  part,  as  Adam  Smith  observes,  being  frequently  no  more 
than  the  reasonable  wages  of  professional  attendance;  for  which, 
until  a  late  alteration  of  the  law,  the  apothecary  could  not  de¬ 
mand  any  remuneration,  except  in  the  prices  of  his  drugs.  Some 
occupations  require  a  considerable  amount  of  scientific  or  tech¬ 
nical  education,  and  can  only  be  carried  on  by  persons  who  com¬ 
bine  with  that  education  a  considerable  capital.  Such  is  the  busi¬ 
ness  of  an  engineer,  both  in  the  original  sense  of  the  term,  a 
machine-maker,  and  in  its  popular  or  derivative  sense,  an  under¬ 
taker  of  public  works.  These  are  always  the  most  profitable 
employments.  There  are  cases,  again,  in  which  a  considerable 
amount  of  labor  and  skill  is  required  to  conduct  a  business  neces¬ 
sarily  of  limited  extent.  In  such  cases  a  higher  than  common 
rate  of  profit  is  necessary  to  yield  only  the  common  rate  of  re¬ 
muneration.  “  In  a  small  seaport  town,”  says  Adam  Smith,  “  a 
little  grocer  will  make  forty  or  fifty  per  cent,  upon  a  stock  of  a 
single  hundred  pounds,  while  a  considerable  wholesale  merchant 
in  the  same  place  will  scarcely  make  eight  or  ten  per  cent,  upon 
a  stock  of  ten  thousand.  The  trade  of  the  grocer  may  be  neces¬ 
sary  for  the  conveniency  of  the  inhabitants,  and  the  narrowness 
of  the  market  may  not  admit  the  employment  of  a  larger  capital 
in  the  business.  The  man,  however,  must  not  only  live  by  his 
trade,  but  live  by  it  suitably  to  the  qualifications  which  it  re¬ 
quires.  Besides  possessing  a  little  capital,  he  must  be  able  to 
read,  write,  and  account,  and  must  be  a  tolerable  judge,  too,  of 
perhaps  fifty  or  sixty  different  sorts  of  goods,  their  prices,  quali¬ 
ties,  and  the  markets  where  they  are  to  be  had  cheapest.  Thirty  or 
forty  pounds  a  year  cannot  be  considered  as  too  great  a  recom¬ 
pense  for  the  labor  of  a  person  so  accomplished.  Deduct  this 
from  the  seemingly  great  profits  of  his  capital,  and  little  more 
will  remain,  perhaps,  than  the  ordinary  profits  of  stock.  The 
greater  part  of  the  apparent  profit  is,  in  this  case,  too,  real 
wages.” 


394 


POLITICAL  ECONOMY 


All  the  natural  monopolies  (meaning  thereby  those  which  are 
created  by  circumstances,  and  not  by  law)  which  produce  or 
aggravate  the  disparities  in  the  remuneration  of  different  kinds 
of  labor,  operate  similarly  between  different  employments  of 
capital.  If  a  business  can  only  be  advantageously  carried  on  by 
a  large  capital,  this  in  most  countries  limits  so  narrowly  the 
class  of  persons  who  can  enter  into  the  employment,  that  they 
are  enabled  to  keep  their  rate  of  profit  above  the  general  level. 
A  trade  may  also,  from  the  nature  of  the  case,  be  confined  to  so 
few  hands,  that  profits  may  admit  of  being  kept  up  by  a  com¬ 
bination  among  the  dealers.  It  is  well  known  that  even  among 
so  numerous  a  body  as  the  London  booksellers,  this  sort  of  com¬ 
bination  long  continued  to  exist.  I  have  already  mentioned  the 
case  of  the  gas  and  water  companies. 

§  4.  After  due  allowance  is  made  for  these  various  causes  of 
inequality,  namely,  differences  in  the  risk  or  agreeableness  of 
different  employments,  and  natural  or  artificial  monopolies ;  the 
rate  of  profit  on  capital  in  all  employments  tends  to  an  equality. 
Such  is  the  proposition  usually  laid  down  by  political  economists, 
and  under  proper  explanations  it  is  true. 

That  portion  of  profit  which  is  properly  interest,  and  which 
forms  the  real  remuneration  for  abstinence,  is  strictly  the  same, 
at  the  same  time  and  place,  whatever  be  the  employment.  The 
rate  of  interest  on  equally  good  security,  does  not  vary  according 
to  the  destination  of  the  principal,  though  it  does  vary  from  time 
to  time  very  much,  according  to  the  circumstances  of  the  mar¬ 
ket.  There  is  no  employment  in  which,  in  the  present  state  of 
industry,  competition  is  so  active  and  incessant  as  in  the  lending 
and  borrowing  of  money.  All  persons  in  business  are  occasion¬ 
ally,  and  most  of  them  constantly,  borrowers:  while  all  persons 
not  in  business,  who  possess  moneyed  property,  are  lenders.  Be¬ 
tween  these  two  great  bodies,  there  is  a  numerous,  keen,  and  in¬ 
telligent  class  of  middlemen,  composed  of  bankers,  stockbrokers, 
discount  brokers,  and  others,  alive  to  the  slightest  breath  of 
probable  gain.  The  smallest  circumstance,  or  the  most  transient 
impression  on  the  public  mind,  which  tends  to  an  increase  or  di¬ 
minution  of  the  demand  for  loan,  either  at  the  time  or  prospec¬ 
tively,  operates  immediately  on  the  rate  of  interest:  and  cir¬ 
cumstances  in  the  general  state  of  trade,  really  tending  to  cause 
this  difference  of  demand,  are  continually  occurring,  sometimes 
to  such  an  extent,  that  the  rate  of  interest  on  the  best  mercantile 


PROFITS 


395 


bills  has  been  known  to  vary  in  little  more  than  a  year  (even 
without  the  occurrence  of  the  great  derangement  called  a  com¬ 
mercial  crisis)  from  four  or  less,  to  eight  or  nine  per  cent.  But, 
at  the  same  time  and  place,  the  rate  of  interest  is  the  same,  to 
all  who  can  give  equally  good  security.  The  market  rate  of  in¬ 
terest  is  at  all  times  a  known  and  definite  thing. 

It  is  far  otherwise  with  gross  profit;  which,  though  (as  will 
presently  be  seen)  it  does  not  Vary  much  from  employment  to 
employment,  varies  very  greatly  from  individual  to  individual, 
and  can  scarcely  be  in  any  two  cases  the  same.  It  depends  on 
the  knowledge,  talents,  economy,  and  energy  of  the  capitalist 
himself,  or  of  the  agents  whom  he  employs;  on  the  accidents  of 
personal  connection;  and  even  on  chance.  Hardly  any  two 
dealers  in  the  same  trade,  even  if  their  commodities  are  equally 
good  and  equally  cheap,  carry  on  their  business  at  the  same  ex¬ 
pense,  or  turn  over  their  capital  in  the  same  time.  That  equal 
capitals  give  equal  profits,  as  a  general  maxim  of  trade,  would 
be  as  false  as  that  equal  age  or  size  gives  equal  bodily  strength, 
or  that  equal  reading  or  experience  gives  equal  knowledge.  The 
effect  depends  as  much  upon  twenty  other  things,  as  upon  the 
single  cause  specified. 

But  though  profits  thus  vary,  the  parity,  on  the  whole,  of  dif¬ 
ferent  modes  of  employing  capital  (in  the  absence  of  any  natural 
or  artificial  monopoly)  is  in  a  certain,  and  a  very  important  sense, 
maintained.  On  an  average  (whatever  may  be  the  occasional 
fluctuations)  the  various  employments  of  capital  are  on  such  a 
footing,  as  to  hold  out,  not  equal  profits,  but  equal  expectations  of 
profit,  to  persons  of  average  abilities  and  advantages.  By  equal, 
I  mean  after  making  compensation  for  any  inferiority  in  the 
agreeableness  or  safety  of  an  employment.  If  the  case  were  not 
so;  if  there  were  evidently,  and  to  common  experience,  more 
favorable  chances  of  pecuniary  success  in  one  business  than  in 
others,  more  persons  would  engage  their  capital  in  the  business, 
or  would  bring  up  their  sons  to  it ;  which  in  fact  always  happens 
when  a  business,  like  that  of  an  engineer  at  present,  or  like  any 
newly  established  and  prosperous  manufacture,  is  seen  to  be  a 
growing  and  thriving  one.  If,  on  the  contrary,  a  business  is  not 
considered  thriving;  if  the  chances  of  profit  in  it  are  thought  to 
be  inferior  to  those  in  other  employments;  capital  gradually 
leaves  it,  or  at  least  new  capital  is  not  attracted  to  it;  and  by 
this  change  in  the  distribution  of  capital  between  the  less  profit- 


39^ 


POLITICAL  ECONOMY 


able  and  the  more  profitable  employments,  a  sort  of  balance  is 
restored.  The  expectations  of  profit,  therefore,  in  different  em¬ 
ployments,  cannot  long  continue  very  different:  they  tend  to  a 
common  average,  though  they  are  generally  oscillating  from 
one  side  to  the  other  side  of  the  medium. 

This  equalizing  process,  commonly  described  as  the  transfer 
of  capital  from  one  employment  to  another,  is  not  necessarily 
the  onerous,  slow,  and  almost  impracticable  operation  which  it 
is  very  often  represented  to  be.  In  the  first  place,  it  does  not 
always  imply  the  actual  removal  of  capital  already  embarked 
in  an  employment.  In  a  rapidly  progressive  state  of  capi¬ 
tal,  the  adjustment  often  takes  place  by  means  of  the  new 
accumulations  of  each  year,  which  direct  themselves  in 
preference  towards  the  more  thriving  trades.  Even  when 
a  real  transfer  of  capital  is  necessary,  it  is  by  no  means 
implied  that  any  of  those  who  are  engaged  in  the  un¬ 
profitable  employment,  relinquish  business  and  break  up  their 
establishments.  The  numerous  and  multifarious  channels  of 
credit,  through  which,  in  commercial  nations,  unemployed  capi¬ 
tal  diffuses  itself  over  the  field  of  employment,  flowing  over  in 
greater  abundance  to  the  lower  levels,  are  the  means  by  which 
the  equalization  is  accomplished.  The  process  consists  in  a  lim¬ 
itation  by  one  class  of  dealers  or  producers,  and  an  extension  by 
the  other,  of  that  portion  of  their  business  which  is  carried  on 
with  borrowed  capital.  There  is  scarcely  any  dealer  or  producer 
on  a  considerable  scale,  who  confines  his  business  to  what  can 
be  carried  on  by  his  own  funds.  When  trade  is  good,  he  not 
only  uses  to  the  utmost  his  own  capital,  but  employs,  in  addition, 
much  of  the  credit  which  that  capital  obtains  for  him.  When, 
either  from  oversupply  or  from  some  slackening  in  the  demand 
for  his  commodity,  he  finds  that  it  sells  more  slowly  or  obtains 
a  lower  price,  he  contracts  his  operations,  and  does  not  apply  to 
bankers  or  other  money  dealers  for  a  renewal  of  their  advances 
to  the  same  extent  as  before.  A  business  which  is  increasing 
holds  out,  on  the  contrary,  a  prospect  of  profitable  employment 
for  a  larger  amount  of  this  floating  capital  than  previously,  and 
those  engaged  in  it  become  applicants  to  the  money  dealers  for 
larger  advances,  which,  from  their  improving  circumstances, 
they  have  no  difficulty  in  obtaining.  A  different  distribution  of 
floating  capital  between  two  employments  has  as  much  effect  in 
restoring  their  profits  to  an  equilibrium,  as  if  the  owners  of  an 


PROFITS 


397 


equal  amount  of  capital  were  to  abandon  the  one  trade  and 
carry  their  capital  into  the  other.  This  easy,  and  as  it  were 
spontaneous,  method  of  accommodating  production  to  demand, 
is  quite  sufficient  to  correct  any  inequalities  arising  from  the 
fluctuations  of  trade,  or  other  causes  of  ordinary  occurrence.  In 
the  case  of  an  altogether  declining  trade,  in  which  it  is  necessary 
that  the  production  should  be,  not  occasionally  varied,  but 
greatly  and  permanently  diminished,  or  perhaps  stopped  alto¬ 
gether,  the  process  of  extricating  the  capital  is,  no  doubt,  tardy 
and  difficult,  and  almost  always  attended  with  considerable  loss; 
much  of  the  capital  fixed  in  machinery,  buildings,  permanent 
works,  etc.  being  either  not  applicable  to  any  other  purpose,  or 
only  applicable  after  expensive  alterations;  and  time  being  sel¬ 
dom  given  for  effecting  the  change  in  the  mode  in  which  it 
would  be  effected  with  least  loss,  namely,  by  not  replacing  the 
fixed  capital  as  it  wears  out.  There  is  besides,  in  totally  chang¬ 
ing  the  destination  of  a  capital,  so  great  a  sacrifice  of  established 
connection,  and  of  acquired  skill  and  experience,  that  people  are 
always  very  slow  in  resolving  upon  it,  and  hardly  ever  do  so  until 
long  after  a  change  of  fortune  has  become  hopeless.  These, 
however,  are  distinctly  exceptional  cases,  and  even  in  these  the 
equalization  is  at  last  effected.  It  may  also  happen  that  the  re¬ 
turn  to  equilibrium  is  considerably  protracted,  when,  before  one 
inequality  has  been  corrected,  another  cause  of  inequality  arises; 
which  is  said  to  have  been  continually  the  case  during  a  long 
series  of  years,  with  the  production  of  cotton  in  the  Southern 
States  of  North  America;  the  commodity  having  been  upheld 
at  what  was  virtually  a  monopoly  price,  because  the  increase  of 
demand,  from  successive  improvements  in  the  manufacture, 
went  on  with  a  rapidity  so  much  beyond  expectation,  that  for 
many  years  the  supply  never  completely  overtook  it.  But  it  is 
not  often  that  a  succession  of  disturbing  causes,  all  acting  in  the 
same  direction,  are  known  to  follow  one  another  with  hardly  any 
interval.  Where  there  is  no  monopoly,  the  profits  of  a  trade 
are  likely  to  range  sometimes  above  and  sometimes  below  the 
general  level,  but  tending  always  to  return  to  it;  like  the  oscilla¬ 
tions  of  the  pendulum. 

In  general,  then,  although  profits  are  very  different  to  dif¬ 
ferent  individuals,  and  to  the  same  individual  in  different  years, 
there  cannot  be  much  diversity  at  the  same  time  and  place  in  the 
average  profits  of  different  employments  (other  than  the  stand- 


398 


POLITICAL  ECONOMY 


ing  differences  necessary  to  compensate  for  difference  of  attrac¬ 
tiveness),  except  for  short  periods,  or  when  some  great  perma¬ 
nent  revulsion  has  overtaken  a  particular  trade.  If  any  popular 
impression  exists  that  some  trades  are  more  profitable  than 
others,  independently  of  monopoly,  or  of  such  rare  accidents  as 
have  been  noticed  in  regard  to  the  cotton  trade,  the  impression 
is  in  all  probability  fallacious,  since  if  it  were  shared  by  those  who 
have  greatest  means  of  knowledge  and  motives  to  accurate  ex¬ 
amination,  there  would  take  place  such  an  influx  of  capital  as 
would  soon  lower  the  profits  to  the  common  level.  It  is  true 
that,  to  persons  with  the  same  amount  of  original  means,  there 
is  more  chance  of  making  a  large  fortune  in  some  employments 
than  in  others.  But  it  would  be  found  that  in  those  same  em¬ 
ployments  bankruptcies  also  are  more  frequent,  and  that  the 
chance  of  greater  success  is  balanced  by  a  greater  probability 
of  complete  failure.  Very  often  it  is  more  than  balanced:  for, 
as  was  remarked  in  another  case,  the  chance  of  great  prizes 
operates  with  a  greater  degree  of  strength  than  arithmetic  will 
warrant,  in  attracting  competitors;  and  I  doubt  not  that  the 
average  gains,  in  a  trade  in  which  large  fortunes  may  be  made, 
are  lower  than  in  those  in  which  gains  are  slow,  though  com¬ 
paratively  sure,  and  in  which  nothing  is  to  be  ultimately  hoped 
for  beyond  a  competency.  The  timber  trade  of  Canada  is  one 
example  of  an  employment  of  capital,  partaking  so  much  of  the 
nature  of  a  lottery,  as  to  make  it  an  accredited  opinion  that,  tak¬ 
ing  the  adventurers  in  the  aggregate,  there  is  more  money  lost 
by  the  trade  than  gained  by  it;  in  other  words,  that  the  average 
rate  of  profit  is  less  than  nothing.  In  such  points  as  this,'  much 
depends  on  the  characters  of  nations,  according  as  they  partake 
more  or  less  of  the  adventurous,  or,  as  it  is  called  when  the  inten¬ 
tion  is  to  blame  it,  the  gambling  spirit.  This  spirit  is  much 
stronger  in  the  United  States  than  in  Great  Britain;  and  in 
Great  Britain  than  in  any  country  of  the  Continent.  In  some 
Continental  countries  the  tendency  is  so  much  the  reverse,  that 
safe  and  quiet  employments  probably  yield  a  less  average  profit 
to  the  capital  engaged  in  them,  than  those  which  offer  greater 
gains  at  the  price  of  greater  hazards. 

It  must  not  however  be  forgotten,  that  even  in  the  countries 
of  most  active  competition,  custom  also  has  a  considerable  share 
in  determining  the  profits  of  trade.  There  is  sometimes  an  idea 
afloat  as  to  what  the  profit  of  an  employment  should  be,  which 


PROFITS 


399 


though  not  adhered  to  by  all  the  dealers,  nor  perhaps  rigidly  by 
any,  still  exercises  a  certain  influence  over  their  operations. 
There  has  been  in  England  a  kind  of  notion,  how  widely  pre¬ 
vailing  I  know  not,  that  fifty  per  cent,  is  a  proper  and  suitable 
rate  of  profit  in  retail  transactions:  understand,  not  fifty  per  cent, 
on  the  whole  capital,  but  an  advance  of  fifty  per  cent,  on  the 
wholesale  prices;  from  which  have  to  be  defrayed  bad  debts, 
shop  rent,  the  pay  of  clerks,  shopmen,  and  agents  of  all  de¬ 
scriptions,  in  short  all  the  expenses  of  the  retail  business.  If 
this  custom  were  universal,  and  strictly  adhered  to,  competition 
indeed  would  still  operate,  but  the  consumer  would  not  derive 
any  benefit  from  it,  at  least  as  to  price;  the  way  in  which  it 
would  diminish  the  advantages  of  those  engaged  in  retail  trade, 
would  be  by  a  greater  subdivision  of  the  business.  In  some  parts 
of  the  Continent  the  standard  is  as  high  as  a  hundred  per  cent. 
The  increase  of  competition,  however,  in  England  at  least,  is 
rapidly  tending  to  break  down  customs  of  this  description.  In 
the  majority  of  trades  (at  least  in  the  great  emporia  of  trade) 
there  are  numerous  dealers  whose  motto  is  “  small  gains  and 
frequent  ” — a  great  business  at  low  prices,  rather  than  high  prices 
and  few  transactions;  and  by  turning  over  their  capital  more 
rapidly,  and  adding  to  it  by  borrowed  capital  when  needed,  the 
dealers  often  obtain  individually  higher  profits;  though  they 
necessarily  lower  the  profits  of  those  among  their  competitors, 
who  do  not  adopt  the  same  principle.  Nevertheless,  competi¬ 
tion,  as  remarked  *  in  a  previous  chapter,  has,  as  yet,  but  a 
limited  dominion  over  retail  prices;  and  consequently  the  share 
of  the  whole  produce  of  land  and  labor  which  is  absorbed  in  the 
remuneration  of  mere  distributors,  continues  exorbitant;  and 
there  is  no  function  in  the  economy  of  society  which  supports 
a  number  of  persons  so  disproportionate  to  the  amount  of  work 
to  be  performed. 

§  5.  The  preceding  remarks  have  I  hope,  sufficiently  eluci¬ 
dated  what  is  meant  by  the  common  phrase,  “  the  ordinary  rate 
of  profit;”  and  the  sense  in  which,  and  the  limitations  under 
which,  this  ordinary  rate  has  a  real  existence.  It  now  remains 
to  consider,  what  causes  determine  its  amount. 

To  popular  apprehension  it  seems  as  if  the  profits  of  business 
depended  upon  prices.  A  producer  or  dealer  seems  to  obtain 
his  profits  by  selling  his  commodity  for  more  than  it  cost  him. 

*  Vide  supra,  Book  II.  chap.  iv.  §  3. 


400 


POLITICAL  ECONOMY 


Profit  altogether,  people  are  apt  to  think,  is  a  consequence  of 
purchase  and  sale.  It  is  only  (they  suppose)  because  there  are 
purchasers  for  a  commodity,  that  the  producer  of  it  is  able  to 
make  any  profit.  Demand — customers — a  market  for  the  com¬ 
modity,  are  the  cause  of  the  gains  of  capitalists.  It  is  by  the 
sale  of  their  goods,  that  they  replace  their  capital,  and  add  to  its 
amount. 

This,  however,  is  looking  only  at  the  outside  surface  of  the 
economical  machinery  of  society.  In  no  case,  we  find,  is  the 
mere  money  which  passes  from  one  person  to  another  the  funda¬ 
mental  matter  in  any  economical  phenomenon.  If  we  look  more 
narrowly  into  the  operations  of  the  producer,  we  shall  perceive 
that  the  money  he  obtains  for  his  commodity  is  not  the  cause 
of  his  having  a  profit,  but  only  the  mode  in  which  his  profit  is 
paid  to  him. 

The  cause  of  profit  is,  that  labor  produces  more  than  is  re¬ 
quired  for  its  support.  The  reason  why  agricultural  capital 
yields  a  profit,  is  because  human  beings  can  grow  more  food 
than  is  necessary  to  feed  them  while  it  is  being  grown,  including 
the  time  occupied  in  constructing  the  tools,  and  making  all 
other  needful  preparations;  from  which  it  is  a  consequence,  that 
if  a  capitalist  undertakes  to  feed  the  laborers  on  condition  of 
receiving  the  produce,  he  has  some  of  it  remaining  for  himself 
after  replacing  his  advances.  To  vary  the  form  of  the  theorem: 
the  reason  why  capital  yields  a  profit,  is  because  food,  clothing, 
materials,  and  tools  last  longer  than  the  time  which  was  required 
to  produce  them;  so  that  if  a  capitalist  supplies  a  party  of  la¬ 
borers  with  these  things,  on  condition  of  receiving  all  they  pro¬ 
duce,  they  will,  in  addition  to  reproducing  their  own  necessaries 
and  instruments,  have  a  portion  of  their  time  remaining,  to  work 
for  the  capitalist.  We  thus  see  that  profit  arises,  not  from  the  in¬ 
cident  of  exchange,  but  from  the  productive  power  of  labor;  and 
the  general  profit  of  the  country  is  always  what  the  productive 
power  of  labor  makes  it,  whether  any  exchange  takes  place  or 
not.  If  there  were  no  division  of  employments,  there  would  be 
no  buying  or  selling,  but  there  would  still  be  profit.  If  the  la¬ 
borers  of  the  country  collectively  produce  twenty  per  cent,  more 
than  their  wages,  profits  will  be  twenty  per  cent.,  whatever  prices 
may  or  may  not  be.  The  accidents  of  price  may  for  a  time  make 
one  set  of  producers  get  more  than  twenty  per  cent.,  and  another 
less,  the  one  commodity  being  rated  above  its  natural  value  in 


PROFITS 


401 


relation  to  other  commodities,  and  the  other  below,  until  prices 
have  again  adjusted  themselves;  but  there  will  always  be  just 
twenty  per  cent,  divided  among  them  all. 

I  proceed,  in  expansion  of  the  considerations  thus  briefly  in¬ 
dicated,  to  exhibit  more  minutely  the  mode  in  which  the  rate  of 
profit  is  determined. 

§  6.  I  assume,  throughout,  the  state  of  things,  which,  where 
the  laborers  and  capitalists  are  separate  classes,  prevails,  with 
few  exceptions,  universally;  namely,  that  the  capitalist  advances 
the  whole  expenses,  including  the  entire  remuneration  of  the  la¬ 
borer.  That  he  should  do  so,  is  not  a  matter  of  inherent  neces¬ 
sity;  the  laborer  might  wait  until  the  production  is  complete,  for 
all  that  part  of  his  wages  which  exceeds  mere  necessaries;  and 
even  for  the  whole,  if  he  has  funds  in  hand,  sufficient  for  his  tem¬ 
porary  support.  But  in  the  latter  case,  the  laborer  is  to  that  ex¬ 
tent  really  a  capitalist,  investing  capital  in  the  concern,  by  sup¬ 
plying  a  portion  of  the  funds  necessary  for  carrying  it  on;  and 
even  in  the  former  case  he  may  be  looked  upon  in  the  same 
light,  since,  contributing  his  labor  at  less  than  the  market  price, 
he  may  be  regarded  as  lending  the  difference  to  his  employer,  and 
receiving  it  back  with  interest  (on  whatever  principle  computed) 
from  the  proceeds  of  the  enterprise. 

The  capitalist,  then,  may  be  assumed  to  make  all  the  advances, 
and  receive  all  the  produce.  His  profit  consists  of  the  excess 
of  the  produce  above  the  advances ;  his  rate  of  profit  is  the  ratio 
which  that  excess  bears  to  the  amount  advanced.  But  what  do 
the  advances  consist  of? 

It  is,  for  the  present,  necessary  to  suppose,  that  the  capitalist 
does  not  pay  any  rent;  has  not  to  purchase  the  use  of  any  ap¬ 
propriated  natural  agent.  This  indeed  is  scarcely  ever  the  exact 
truth.  The  agricultural  capitalist,  except  when  he  is  the  owner 
of  the  soil  he  cultivates,  always,  or  almost  always,  pays  rent: 
and  even  in  manufactures  (not  to  mention  ground-rent,) 
the  materials  of  the  manufacture  have  generally  paid  rent, 
in  some  stage  of  their  production.  The  nature  of  rent  however, 
we  have  not  yet  taken  into  consideration;  and  it  will  hereafter 
appear,  that  no  practical  error,  on  the  question  we  are  now  ex¬ 
amining,  is  produced  by  disregarding  it. 

If,  then,  leaving  rent  out  of  the  question,  we  inquire  in  what 
it  is  that  the  advances  of  the  capitalists,  for  purposes  of  produc¬ 
tion,  consist,  we  shall  find  that  they  consist  of  wages  of  labor. 

Vol.  I. — 26 


402 


POLITICAL  ECONOMY 


A  large  portion  of  the  expenditure  of  every  capitalist  consists 
in  the  direct  payment  of  wages.  What  does  not  consist  of  this,  is 
composed  of  materials  and  implements,  including  buildings. 
But  materials  and  implements  are  produced  by  labor;  and  as 
our  supposed  capitalist  is  not  meant  to  represent  a  single  em¬ 
ployment,  but  to  be  a  type  of  the  productive  industry  of  the 
whole  country,  we  may  suppose  that  he  makes  his  own  tools, 
and  raises  his  own  materials.  He  does  this  by  means  of  previous 
advances,  which,  again,  consist  wholly  01  wages.  If  we  suppose 
him  to  buy  the  materials  and  tools  instead  of  producing  them, 
the  case  is  not  altered:  he  then  repays  to  a  previous  producer 
the  wages  which  that  previous  producer  has  paid.  It  is  true, 
he  repays  it  to  him  with  a  profit;  and  if  he  had  produced  the 
things  himself,  he  himself  must  have  had  that  profit,  on  this 
part  of  his  outlay,  as  well  as  on  every  other  part.  The  fact, 
however,  remains,  that  in  the  whole  process  of  production,  be¬ 
ginning  with  the  materials  and  tools,  and  ending  with  the  fin¬ 
ished  product,  all  the  advances  have  consisted  of  nothing  but 
wages;  except  that  certain  of  the  capitalists  concerned  have, 
for  the  sake  of  general  convenience,  had  their  share  of  profit 
paid  to  them  before  the  operation  was  completed.  Whatever, 
of  the  ultimate  product,  is  not  profit,  is  repayment  of  wages. 

§  7.  It  thus  appears  that  the  two  elements  on  which,  and  which 
alone,  the  gains  of  the  capitalists  depend,  are,  first,  the  magni¬ 
tude  of  the  produce,  in  other  words,  the  productive  power  of 
labor;  and  secondly,  the  proportion  of  that  produce  obtained 
by  the  laborers  themelves;  the  ratio,  which  the  remuneration  of 
the  laborers  bears  to  the  amount  they  produce.  These  two 
things  form  the  data  for  determining  the  gross  amount  divided 
as  profit  among  all  the  capitalists  of  the  country;  but  the  rate 
of  profit,  the  percentage  on  the  capital,  depends  only  on  the  sec¬ 
ond  of  the  two  elements,  the  laborer’s  proportional  share,  and 
not  on  the  amount  to  be  shared.  If  the  produce  of  labor  were 
doubled,  and  the  laborers  obtained  the  same  proportional  share 
as  before,  that  is,  if  their  remuneration  was  also  doubled,  the 
capitalists,  it  is  true,  would  gain  twice  as  much;  but  as  they 
would  also  have  had  to  advance  twice  as  much,  the  rate  of  their 
profit  would  be  only  the  same  as  before. 

We  thus  arrive  at  the  conclusion  of  Ricardo  and  others,  that 
the  rate  of  profits  depends  on  wages;  rising  as  wages  fall,  and 
falling  as  wages  rise.  In  adopting,  however,  this  doctrine,  I 


PROFITS 


403 


must  insist  upon  making  a  most  necessary  alteration  in  its  word¬ 
ing.  Instead  of  saying  that  profits  depend  on  wages,  let  us  say 
(what  Ricardo  really  meant)  that  they  depend  on  the  cost  of 
labor. 

Wages,  and  the  cost  of  labor;  what  labor  brings  in  to  the  la¬ 
borer,  and  what  it  costs  to  the  capitalist;  are  ideas  quite  dis¬ 
tinct,  and  which  it  is  of  the  utmost  importance  to  keep  so.  For 
this  purpose  it  is  essential  not  to  designate  them,  as  is  almost 
always  done,  by  the  same  name.  Wages,  in  public  discussions, 
both  oral  and  printed,  being  looked  upon  from  the  point  of  view 
of  the  payers,  much  often  than  from  that  of  the  receivers,  noth¬ 
ing  is  more  common  than  to  say  that  wages  are  high  or  low, 
meaning  only  that  the  cost  of  labor  is  high  or  low.  The  reverse 
of  this  would  be  often  the  truth :  the  cost  of  labor  is  frequently 
at  its  highest  where  wages  are  lowest.  This  may  arise  from  two 
causes.  In  the  first  place,  the  labor,  though  cheap,  may  be  in¬ 
efficient.  In  no  European  country  are  wages  so  low  as  they  are 
(or  at  least  were)  in  Ireland ;  the  remuneration  of  an  agricultural 
laborer  in  the  west  of  Ireland  not  being  more  than  half  the  wages 
of  even  the  lowest-paid  Englishman,  the  Dorsetshire  laborer. 
But  if,  from  inferior  skill  and  industry,  two  days’  labor  of  an 
Irishman  accomplished  no  more  work  than  an  English  laborer 
performed  in  one,  the  Irishman’s  labor  cost  as  much  as  the  Eng¬ 
lishman’s,  though  it  brought  in  so  much  less  to  himself.  The 
capitalist’s  profit  is  determined  by  the  former  of  these  two  things, 
not  by  the  latter.  That  a  difference  to  this  extent  really  existed 
in  the  efficiency  of  the  labor,  is  proved  not  only  by  abundant 
testimony,  but  by  the  fact,  that  notwithstanding  the  lowness  of 
wages,  profits  of  capital  are  not  understood  to  have  been  higher 
in  Ireland  than  in  England. 

The  other  cause  which  renders  wages,  and  the  cost  of  labor, 
no  real  criteria  of  one  another,  is  the  varying  costliness  of  the 
articles  which  the  laborer  consumes.  If  these  are  cheap,  wages, 
in  the  sense  which  is  of  importance  to  the  laborer,  may  be  high, 
and  yet  the  cost  of  labor  may  be  low;  if  dear,  the  laborer  may 
be  wretchedly  off,  though  his  labor  may  cost  much  to  the  capi¬ 
talist.  This  last  is  the  condition  of  a  country  over-peopled  in 
relation  to  its  land;  in  which,  food  being  dear,  the  poorness  of 
the  laborer’s  real  reward  does  not  prevent  labor  from  costing 
much  to  the  purchaser,  and  low  wages  and  low  profits  co-exist. 
The  opposite  case  is  exemplified  in  the  United  States  of  America. 


404 


POLITICAL  ECONOMY 


The  laborer  there  enjoys  a  greater  abundance  of  comforts  than 
in  any  other  country  of  the  world,  except  some  of  the  newest 
colonies;  but,  owing  to  the  cheap  price  at  which  these  comforts 
can  be  obtained  (combined  with  the  great  efficiency  of  the  labor,) 
the  cost  of  labor  is  at  least  not  higher,  nor  the  rate  of  profit  lower, 
than  in  Europe. 

The  cost  of  labor,  then,  is,  in  the  language  of  mathematics, 
a  function  of  three  variables:  the  efficiency  of  labor;  the  wages 
of  labor  (meaning  thereby  the  real  reward  of  the  laborer) ;  and 
the  greater  or  less  cost  at  which  the  articles  composing  that  real 
reward  can  be  produced  or  procured.  It  is  plain  that  the  cost  of 
labor  to  the  capitalist  must  be  influenced  by  each  of  these  three 
circumstances,  and  by  no  others.  These,  therefore,  are  also  the 
circumstances  which  determine  the  rate  of  profit;  and  it  cannot 
be  in  any  way  affected  except  through  one  or  other  of  them.  If 
labor  generally  became  more  efficient,  without  being  more  highly 
rewarded ;  if,  without  its  becoming  less  efficient,  its  remuneration 
fell,  no  increase  taking  place  in  the  cost  of  the  articles  composing 
that  remuneration;  or  if  those  articles  became  less  costly  with¬ 
out  the  laborer’s  obtaining  more  of  them;  in  any  one  of  these 
three  cases,  profits  would  rise.  If,  on  the  contrary,  labor  became 
less  efficient  (as  it  might  do  from  diminished  bodily  vigor  in  the 
people,  destruction  of  fixed  capital,  or  deteriorated  education); 
or  if  the  laborer  obtained  a  higher  remuneration,  without  any 
increased  cheapness  in  the  things  composing  it;  or  if,  without 
his  obtaining  more,  that  which  he  did  obtain  became  more  cost¬ 
ly;  profits,  in  all  these  cases,  would  suffer  a  diminution.  And 
there  is  no  other  combination  of  circumstances,  in  which  the 
general  rate  of  profit  of  a  country,  in  all  employments  indif¬ 
ferently,  can  either  fall  or  rise. 

The  evidence  of  these  propositions  can  only  be  stated  gen¬ 
erally,  though,  it  is  hoped,  conclusively,  in  this  stage  of  our 
subject.  It  will  come  out  in  greater  fulness  and  force  when, 
having  taken  into  consideration  the  theory  of  Value  and  Price, 
we  shall  be  enabled  to  exhibit  the  law  of  profits  in  the  concrete 
— in  the  complex  entanglement  of  circumstances  in  which  it 
actually  works.  This  can  only  be  done  in  the  ensuing  Book. 
One  topic  still  remains  to  be  discussed  in  the  present  one,  so 
far  as  it  admits  of  being  treated  independently  of  considerations 
of  Value:  the  subject  of  Rent;  to  which  we  now  proceed. 


RENTS 


405 


Chapter  XVI. — Of  Rent 


§  1.  The  requisites  of  production  being  labor,  capital,  and 
natural  agents ;  the  only  person,  besides  the  laborer  and  the 
capitalist,  whose  consent  is  necessary  to  production,  and  who 
can  claim  a  share  of  the  produce  as  the  price  of  that  consent, 
is  the  person  who,  by  the  arrangements  of  society,  possesses 
exclusive  power  over  some  natural  agent.  The  land  is  the 
principal  of  the  natural  agents  which  are  capable  of  being  ap¬ 
propriated,  and  the  consideration  paid  for  its  use  is  called  rent. 
Landed  proprietors  are  the  only  class,  of  any  numbers  or  im¬ 
portance,  who  have  a  claim  to  a  share  in  the  distribution  of 
the  produce,  through  their  ownership,  of  something  which 
neither  they  nor  anyone  else  have  produced.  If  there  be  any 
other  cases  of  a  similar  nature,  they  will  be  easily  understood, 
when  the  nature  and  laws  of  rent  are  comprehended. 

Jt  is  at  once  evident,  that  rent  is  the  effect  of  a  monopoly ; 
though  the  monopoly  is  a  natural  one,  which  may  be  regu¬ 
lated,  which  may  even  be  held  as  a  trust  for  the  community 
generally,  but  which  cannot  be  prevented  from  existing.  The 
reason  why  landowners  are  able  to  require  rent  for  their  land, 
is  that  it  is  a  commodity  which  many  want,  and  which  no  one 
can  obtain  but  from  them.  If  all  the  land  of  the  country  be¬ 
longed  to  one  person,  he  could  fix  the  rent  at  his  pleasure.  The 
whole  people  would  be  dependent  on  his  will  for  the  neces¬ 
saries  of  life,  and  he  might  make  what  conditions  he  chose. 
This  is  the  actual  state  of  things  in  those  Oriental  kingdoms  in 
which  the  land  is  considered  the  property  of  the  state.  Rent  is 
then  confounded  with  taxation,  and  the  despot  may  exact  the 
utmost  which  the  unfortunate  cultivators  have  to  give.  In¬ 
deed,  the  exclusive  possessor  of  the  land  of  a  country  could 
not  well  be  other  than  despot  of  it.  The  effect  would  be  much 
the  same  if  the  land  belonged  to  so  few  people  that  they  could, 
and  did,  act  together  as  one  man,  and  fix  the  rent  by  agree¬ 
ment  among  themselves.  This  case,  however,  is  nowhere 
known  to  exist :  and  the  only  remaining  supposition  is  that 
of  free  competition ;  the  landowners  being  supposed  to  be,  as 
in  fact  they  are,  too  numerous  to  combine. 

§  2.  A  thing  which  is  limited  in  quantity,  even  though  its 

§ossessors  do  not  act  in  concert,  is  still  a  monopolized  article, 
ut  even  when  monopolized,  a  thing  which  is  the  gift  of  nature, 


406 


POLITICAL  ECONOMY 


and  requires  no  labor  or  outlay  as  the  condition  of  its  existence, 
will,  if  there  be  competition  among  the  holders  of  it,  command 
a  price,  only  if  it  exists  in  less  quantity  than  the  demand.  If 
the  whole  land  of  a  country  were  required  for  cultivation,  all 
of  it  might  yield  a  rent.  But  in  no  country  of  any  extent  do  the 
wants  of  the  population  require  that  all  the  land,  which  is  ca¬ 
pable  of  cultivation,  should  be  cultivated.  The  food  and  other 
agricultural  produce  which  the  people  need,  and  which  they  are 
willing  and  able  to  pay  for  at  a  price  which  remunerates  the 
grower,  may  always  be  obtained  without  cultivating  all  the 
land ;  sometimes  without  cultivating  more  than  a  small  part 
of  it ;  the  lands  most  easily  cultivated  being  preferred  in  a  very 
early  stage  of  society,  the  more  fertile,  or  those  in  the  more 
convenient  situations,  in  a  more  advanced  state.  There  is  al¬ 
ways,  therefore,  some  land  which  cannot,  in  existing  circum¬ 
stances,  pay  any  rent ;  and  no  land  ever  pays  rent,  unless,  in 
point  of  fertility  or  situation,  it  belongs  to  those  superior  kinds 
which  exist  in  less  quantity  than  the  demand — which  cannot 
be  made  to  yield  all  the  produce  required  for  the  community, 
unless  on  terms  still  less  advantageous  than  the  resort  to  less 
favored  soils. 

There  is  land,  such  as  the  deserts  of  Arabia,  which  will  yield 
nothing  to  any  amount  of  labor ;  and  there  is  land,  like  some 
of  our  hard  sandy  heaths,  which  would  produce  something, 
but,  in  the  present  state  of  the  soil,  not  enough  to  defray  the 
expenses  of  production.  Such  lands,  unless  by  some  applica¬ 
tion  of  chemistry  to  agriculture  still  remaining  to  be  invented, 
cannot  be  cultivated  for  profit,  unless  some  one  actually  creates 
a  soil,  by  spreading  new  ingredients  over  the  surface,  or  mix¬ 
ing  them  with  the  existing  materials.  If  ingredients  fitted  for 
this  purpose  exist  in  the  subsoil,  or  close  at  hand,  the  improve¬ 
ment  even  of  the  most  unpromising  spots  may  answer  as  a 
speculation :  but  if  those  ingredients  are  costly,  and  must  be 
brought  from  a  distance,  it  will  seldom  answer  to  do  this  for  the 
sake  of  profit,  though  the  “  magic  of  property”  will  some¬ 
times  effect  it.  Land  which  cannot  possibly  yield  a  profit,  is 
sometimes  cultivated  at  a  loss,  the  cultivators  having  their 
wants  partially  supplied  from  other  sources ;  as  in  the  case  of 
paupers,  and  some  monasteries  or  charitable  institutions, 
among  which  may  be  reckoned  the  Poor  Colonies  of  Belgium. 
The  worst  land  which  can  be  cultivated  as  a  means  of  sub- 


RENTS 


407 


sistence,  is  that  which  will  just  replace  the  seed,  and  the  food 
of  the  laborers  employed  on  it  together  with  what  Dr.  Chalmers 
calls  their  secondaries ;  that  is,  the  laborers  required  for  sup¬ 
plying  them  with  tools,  and  with  the  remaining  necessaries 
of  life.  Whether  any  given  land  is  capable  of  doing  more  than 
this,  is  not  a  question  of  political  economy,  but  of  physical  fact. 
The  supposition  leaves  nothing  for  profits,  nor  anything  for 
the  laborers  except  necessaries :  the  land,  therefore,  can  only 
be  cultivated  by  the  laborers  themselves,  or  else  at  a  pecuniary 
loss :  and  a  fortiori ,  cannot  in  any  contingency  afford  a  rent. 
The  worst  land  which  can  be  cultivated  as  an  investment  for 
capital,  is  that  which,  after  replacing  the  seed,  not  only  feeds 
the  agricultural  laborers  and  their  secondaries,  but  affords  them 
the  current  rate  of  wages,  which  may  extend  to  much  more 
than  mere  necessaries ;  and  leaves  for  those  who  have  ad¬ 
vanced  the  wages  of  these  two  classes  of  laborers,  a  surplus 
equal  to  the  profit  they  could  have  expected  from  any  other 
employment  of  their  capital.  Whether  any  given  land  can 
do  more  than  this,  is  not  merely  a  physical  question,  but  de¬ 
pends  partly  on  the  market  value  of  agricultural  produce. 
What  the  land  can  do  for  the  laborers  and  for  the  capitalist, 
beyond  feeding  all  whom  it  directly  or  indirectly  employs,  of 
course  depends  upon  what  the  remainder  of  the  produce  can  be 
sold  for.  The  higher  the  market  value  of  produce,  the  lower 
are  the  soils  to  which  cultivation  can  descend,  consistently 
with  affording  to  the  capital  employed,  the  ordinary  rate  of 
profit. 

As,  however,  differences  of  fertility  slide  into  one  another 
by  insensible  gradations ;  and  differences  of  accessibility,  that 
is,  of  distance  from  markets,  do  the  same ;  and  since  there  is 
land  so  barren  that  it  could  not  pay  for  its  cultivation  at  any 
price ;  it  is  evident  that,  whatever  the  price  may  be,  there  must 
in  any  extensive  region  be  some  land  which  at  that  price  will 
just  pay  the  wages  of  the  cultivators,  and  yield  to  the  capital 
employed  the  ordinary  profit,  and  no  more.  Until,  therefore, 
the  price  rises  higher,  or  until  some  improvement  raises  that 
particular  land  to  a  higher  place  in  the  scale  of  fertility,  it  can¬ 
not  pay  ajiy  rent.  It  is  evident,  however,  that  the  community 
needs  the  produce  of  this  quality  of  land :  since  if  the  lands 
more  fertile  or  better  situated  than  it,  could  have  sufficed  to 
supply  the  wants  of  society,  the  price  would  not  have  risen  so 


408 


POLITICAL  ECONOMY 


high  as  to  render  its  cultivation  profitable.  This  land,  there¬ 
fore,  will  be  cultivated ;  and  we  lay  it  down  as  a  principle,  that 
so  long  as  any  of  the  land  of  a  country  which  is  fit  for  cultiva¬ 
tion,  and  not  withheld  from  it  by  legal  or  other  factitious  ob¬ 
stacles,  is  not  cultivated,  the  worst  land  in  actual  cultivation 
(in  point  of  fertility  and  situation  together)  pays  no  rent. 

§  3.  If,  then,  of  the  land  in  cultivation,  the  part  which  yields 
least  return  to  the  labor  and  capital  employed  on  it  gives  only 
the  ordinary  profit  of  capital,  without  leaving  anything  for  rent ; 
a  standard  is  afforded  for  estimating  the  amount  of  rent  which 


will  be  yielded  by  all  other  land.  Any  land  yields  just  as  much 
more  than  the  ordinary  profits  of  stock,  as  it  yields  more  than 
what  is  returned  by  the  worst  land  in  cultivation.  The  surplus 
is  what  the  farmer  can  afford  to  pay  as  rent  to  the  landlord ;  and 
since,  if  he  did  not  so  pay  it,  he  would  receive  more  than  the 
ordinary  rate  of  profit,  the  competition  of  other  capitalists,  that 
competition  which  equalizes  the  profits  of  different  capitals, 
will  enable  the  landlord  to  appropriate  it.  The  rent,  therefore, 
which  any  land  will  yield,  is  the  excess  of  its  produce,  beyond 
what  would  be  returned  to  the  same  capital  if  employed  on 
the  worst  land  in  cultivation.  This  is  not,  and  never  was  pre¬ 
tended  to  be,  the  limit  of  metayer  rents,  or  of  cottier  rents ;  but 
it  is  the  limit  of  farmers’  rents.  No  land  rented  to  a  capitalist 
farmer  will  permanently  yield  more  than  this ;  and  when  it 
yields  less,  it  is  because  the  landlord  foregoes  a  part  of  what,  if 
he  chose,  he  could  obtain. 

This  is  the  theory  q£  QBPtyJkst  propounded  at  the  end  of  the 


time,  was  almost  simultaneously ...  rpdi*gr,-nYpr*d,  *wmty  years 
later,  by  Sir  Edward  West,  Mr.  Malthus,  and  Mr.  Ricardo.  It 
is  one  of  the  cardinal  doctrines  of  political  economy ;  and  until 
it  was  understood,  no  consistent  explanation  could  be  given  of 
many  of  the  more  complicated  industrial  phenomena.  The 
evidence  of  its  truth  will  be  manifested  with  a  great  increase  of 
clearness,  when  we  come  to  trace  the  laws  of  the  phenomena 
of  Value  and  Price.  Until  that  is  done,  it  is  not  possible  to 
free  the  doctrine  from  every  difficulty  which  may  present  itself, 
nor  perhaps  to  convey,  to  those  previously  unacquainted  with 
the  subject,  more  than  a  general  apprehension  of  the  reasoning 
by  which  the  theorem  is  arrived  at.  Some,  however,  of  the  ob¬ 
jections  commonly  made  to  it,  admit  of  a  complete  answer  even 
in  the  present  stage  of  our  inquiries. 


RENTS 


409 


It  has  been  denied  that  there  can  be  any  land  in  cultivation 
which  pays  no  rent ;  because  landlords  (it  is  contended)  would 
not  allow  their  land  to  be  occupied  without  payment.  Those 
who  lay  any  stress  on  this  as  an  objection,  must  think  that  land 
of  the  quality  which  can  but  just  pay  for  its  cultivation,  lies 
together  in  large  masses,  detached  from  any  land  of  better 
quality.  If  an  estate  consisted  wholly  of  this  land,  or  of  this 
and  still  worse,  it  is  likely  enough  that  the  owner  would  not 
give  the  use  of  it  for  nothing ;  he  would  probably  (if  a  rich  man) 
prefer  keeping  it  for  other  purposes,  as  for  exercise,  or  orna¬ 
ment,  or  perhaps  as  a  game  preserve.  No  farmer  could  afford 
to  offer  him  anything  for  it,  for  purposes  of  culture,  though 
something  would  probably  be  obtained  for  the  use  of  its  natural 
pasture,  or  other  spontaneous  produce.  Even  such  land,  how¬ 
ever,  would  not  necessarily  remain  uncultivated.  It  might  be 
farmed  by  the  proprietor ;  no  unfrequent  case  even  in  Eng¬ 
land.  Portions  of  it  might  be  granted  as  temporary  allotments 
to  laboring  families,  either  from  philanthropic  motives,  or  to 
save  the  poor-rate  ;  or  occupation  might  be  allowed  to  squatters, 
free  of  rent,  in  the  hope  that  their  labor  might  give  it  value  at 
some  future  period.  Both  these  cases  are  of  quite  ordinary 
occurrence.  So  that  even  if  an  estate  were  wholly  composed 
of  the  worst  land  capable  of  profitable  cultivation,  it  would  not 
necessarily  lie  uncultivated  because  it  could  pay  no  rent.  In¬ 
ferior  land,  however,  does  not  usually  occupy,  without  inter¬ 
ruption,  many  square  miles  of  ground  ;  it  is  dispersed  here  and 
there,  with  patches  of  better  land  intermixed,  and  the  same  per¬ 
son  who  rents  the  better  land,  obtains  along  with  it  the  in¬ 
ferior  soils  which  alternate  with  it.  He  pays  a  rent,  nominally 
for  the  whole  farm,  but  calculated  on  the  produce  of  those  parts 
alone  (however  small  a  portion  of  the  whole)  which  are  capable 
of  returning  more  than  the  common  rate  of  profit.  It  is  thus 
scientifically  true,  that  the  remaining  parts  pay  no  rent. 

§  4.  Let  us,  however,  suppose  that  there  were  a  validity  in 
this  objection,  which  can  by  no  means  be  conceded  to  it;  that 
when  the  demand  of  the  community  had  forced  up  food  to  such 
a  price  as  would  remunerate  the  expense  of  producing  it  from 
a  certain  quality  of  soil,  it  happened  nevertheless  that  all  the 
soil  of  that  quality  was  withheld  from  cultivation,  by  the  ob¬ 
stinacy  of  the  owners  in  demanding  a  rent  for  it,  not  nominal, 
nor  trifling,  but  sufficiently  onerous  to  be  a  material  item  in 


4io 


POLITICAL  ECONOMY 


the  calculations  of  a  farmer.  What  would  then  happen? 
Merely  that  the  increase  of  produce,  which  the  wants  of  so¬ 
ciety  required,  would  for  the  time  be  obtained  wholly  (as  it  al¬ 
ways  is  partially),  not  by  an  extension  of  cultivation,  but  by 
an  increased  application  of  labor  and  capital  to  land  already 
cultivated. 

Now  we  have  already  seen  that  this  increased  application  of 
capital,  other  things  being  unaltered,  is  always  attended  with 
a  smaller  proportional  return.  We  are  not  to  suppose  some 
new  agricultural  invention  made  precisely  at  this  juncture; 
nor  a  sudden  extension  of  agricultural  skill  and  knowledge, 
bringing  into  more  general  practice,  just  then,  inventions  al¬ 
ready  in  partial  use.  We  are  to  suppose  no  change,  except  a 
demand  for  more  corn,  and  a  consequent  rise  of  its  price.  The 
rise  of  price  enables  measures  to  be  taken  for  increasing  the 
produce,  which  could  not  have  been  taken  with  profit  at  the 
previous  price.  The  farmer  uses  more  expensive  manures ; 
or  manures  land  which  he  formerly  left  to  nature ;  or  procures 
lime  or  marl  from  a  distance,  as  a  dressing  for  the  soil ;  or 
pulverizes  or  weeds  it  more  thoroughly ;  or  drains,  irrigates, 
or  subsoils  portions  of  it,  which  at  former  prices  would  not 
have  paid  the  cost  of  the  operation;  and  so  forth.  These 
things,  or  some  of  them,  are  done,  when,  more  food  being 
wanted,  cultivation  has  no  means  of  expanding  itself  upon  new 
lands.  And  when  the  impulse  is  given  to  extract  an  increased 
amount  of  produce  from  the  soil,  the  farmer  or  improver  will 
only  consider  whether  the  outlay  he  makes  for  the  purpose  will 
be  returned  to  him  with  the  ordinary  profit,  and  not  whether 
any  surplus  will  remain  for  rent.  Even,  therefore,  if  it  were  the 
fact,  that  there  is  never  any  land  taken  into  cultivation,  for 
which  rent,  and  that  too  of  an  amount  worth  taking  into  con¬ 
sideration,  was  not  paid ;  it  would  be  true,  nevertheless,  that 
there  is  always  some  agricultural  capital  which  pays  no  rent, 
because  it  returns  nothing  beyond  the  ordinary  rate  of  profit : 
this  capital  being  the  portion  of  capital  last  applied — that  to 
which  the  last  addition  to  the  produce  was  due ;  or  (to  express 
the  essentials  of  the  case  in  one  phrase),  that  which  is  applied 
in  the  least  favorable  circumstances.  But  the  same  amount  of 
demand,  and  the  same  price,  which  enable  this  least  productive 
portion  of  capital  barely  to  replace  itself  with  the  ordinary 
profit,  enable  every  other  portion  to  yield  a  surplus  propor- 


RENTS 


411 

tioned  to  the  advantage  it  possesses.  And  this  surplus  it  is, 
which  competition  enables  the  landlord  to  appropriate.  The 
rent  of  all  land  is  measured  by  the  excess  of  the  return  to  the 
whole  capital  employed  on  it,  above  what  is  necessary  to  re¬ 
place  the  capital  with  the  ordinary  rate  of  profit,  or  in  other 
words,  above  what  the  same  capital  would  yield  if  it  were  all 
employed  in  as  disadvantageous  circumstances  as  the  least  pro¬ 
ductive  portion  of  it :  whether  that  least  productive  portion  of 
capital  is  rendered  so  by  being  employed  on  the  worst  soil, 
or  by  being  expended  in  extorting  more  produce  from  land 
which  already  yielded  as  much  as  it  could  be  made  to  part  with 
on  easier  terms. 

It  is  not  pretended  that  the  facts  of  any  concrete  case  con¬ 
form  with  absolute  precision  to  this  or  any  other  scientific  prin¬ 
ciple.  We  must  never  forget  that  the  truths  of  political  econ¬ 
omy  are  truths  only  in  the  rough.  They  have  the  certainty, 
but  not  the  precision  of  exact  science.  It  is  not,  for  example, 
strictly  true  that  a  farmer  will  cultivate  no  land,  and  apply  no 
capital,  which  returns  less  than  the  ordinary  profit.  He  will 
expect  the  ordinary  profit  on  the  bulk  of  his  capital.  But 
when  he  has  cast  in  his  lot  with  his  farm,  and  bartered  his  skill 
and  exertions,  once  for  all,  against  what  the  farm  will  yield  to 
him,  he  will  probably  be  willing  to  expend  capital  on  it  (for  an 
immediate  return)  in  any  manner  which  will  afford  him  a  sur¬ 
plus  profit,  however  small,  beyond  the  value  of  the  risk,  and  the 
interest  which  he  must  pay  for  the  capital  if  borrowed,  or  can 
get  for  it  elsewhere  if  it  is  his  own.  But  a  new  farmer,  entering 
on  the  land,  would  make  his  calculations  differently,  and  would 
not  commence  unless  he  could  expect  the  full  rate  of  ordinary 
profit  on  all  the  capital  which  he  intended  embarking  in  the 
enterprise.  Again,  prices  may  range  higher  or  lower  during 
the  currency  of  a  lease,  than  was  expected  when  the  contract 
was  made,  and  the  land,  therefore,  may  be  over  or  under-rented : 
and  even  when  the  lease  expires,  the  landlord  may  be  unwill¬ 
ing  to  grant  a  necessary  diminution  of  rent,  and  the  farmer, 
rather  than  relinquish  his  occupation,  or  seek  a  farm  elsewhere 
when  all  are  occupied,  may  consent  to  go  on  paying  too  high 
a  rent.  Irregularities  like  these  we  must  always  expect;  it  is 
impossible  in  political  economy  to  obtain  general  theorems 
embracing  the  complications  of  circumstances  which  may  af¬ 
fect  the  result  in  an  individual  case.  When,  too,  the  farmer 


412 


POLITICAL  ECONOMY 


class,  having  but  little  capital,  cultivate  for  subsistence  rather 
than  for  profit,  and  do  not  think  of  quitting  their  farm  while 
they  are  able  to  live  by  it,  their  rents  approximate  to  the  charac¬ 
ter  of  cottier  rents,  and  may  be  forced  up  by  competition  (if 
the  number  of  competitors  exceeds  the  number  of  farms)  be¬ 
yond  the  amount  which  will  leave  to  the  farmer  the  ordinary 
rate  of  profit.  The  laws  which  we  are  enabled  to  lay  down  re¬ 
specting  rents,  profits,  wages,  prices,  are  only  true  in  so  far  as 
the  persons  concerned  are  free  from  the  influence  of  any  other 
motives  than  those  arising  from  the  general  circumstances  of 
the  case,  and  are  guided,  as  to  those,  by  the  ordinary  mercan¬ 
tile  estimate  of  profit  and  loss.  Applying  this  twofold  supposi¬ 
tion  to  the  case  of  farmers  and  landlords,  it  will  be  true  that 
the  farmer  requires  the  ordinary  rate  of  profit  on  the  whole  of 
his  capital ;  that  whatever  it  returns  to  him  beyond  this  he  is 
obliged  to  pay  to  the  landlord,  but  will  not  consent  to  pay  more ; 
that  there  is  a  portion  of  capital  applied  to  agriculture  in  such 
circumstances  of  productiveness  as  to  yield  only  the  ordinary 
profits ;  and  that  the  difference  between  the  produce  of  this, 
and  of  any  other  capital  of  similar  amount,  is  the  measure  ot 
the  tribute  which  that  other  capital  can  and  will  pay,  under 
the  name  of  rent,  to  the  landlord.  This  constitutes  a  law  of 
rent,  as  near  the  truth  as  such  a  law  can  possibly  be :  though 
of  course  modified  or  disturbed  in  individual  cases,  by  pending 
contracts,  individual  miscalculations,  the  influence  of  habit, 
and  even  the  particular  feelings  and  dispositions  of  the  persons 
concerned. 

§  5.  A  remark  is  often  made,  which  must  not  here  be  omitted, 
though,  I  think,  more  importance  has  been  attached  to  it  than 
it  merits.  Under  the  name  of  rent,  many  payments  are  com¬ 
monly  included,  which  are  not  a  remuneration  for  the  original 
powers  of  the  land  itself,  but  for  capital  expended  on  it.  The 
additional  rent  which  land  yields  in  consequence  of  this  outlay 
of  capital,  should,  in  the  opinion  of  some  writers,  be  regarded 
as  profit,  not  rent.  But  before  this  can  be  admitted,  a  distinc¬ 
tion  must  be  made.  The  annual  payment  by  a  tenant  almost 
always  includes  a  consideration  for  the  use  of  the  buildings  on 
the  farm ;  not  only  barns,  stables,  and  other  outhouses,  but  a 
house  to  live  in,  not  to  speak  of  fences  and  the  like.  The  land¬ 
lord  will  ask,  and  the  tenant  give,  for  these,  whatever  is  con¬ 
sidered  sufficient  to  yield  the  ordinary  profit,  or  rather  (risk 


RENTS 


413 


and  trouble  being  here  out  of  the  question)  the  ordinary  inter¬ 
est,  on  the  value  of  the  buildings ;  that  is,  not  on  what  it  has 
cost  to  erect  them,  but  on  what  it  would  now  cost  to  erect 
others  as  good :  the  tenant  being  bound,  in  addition,  to  leave 
them  in  as  good  repair  as  he  found  them,  for  otherwise  a  much 
larger  payment  than  simple  interest  would  of  course  be  re¬ 
quired  from  him.  These  buildings  are  as  distinct  a  thing  from 
the  farm,  as  the  stock  or  the  timber  on  it;  and  what  is  paid 
for  them  can  no  more  be  called  rent  of  land,  than  a  payment 
for  cattle  would  be,  if  it  were  the  custom  that  the  landlord 
should  stock  the  farm  for  the  tenant.  The  buildings,  like  the 
cattle,  are  not  land,  but  capital,  regularly  consumed  and  repro¬ 
duced  ;  and  all  payments  made  in  consideration  for  them  are 
properly  interest. 

But  with  regard  to  capital  actually  sunk  in  improvements, 
and  not  requiring  periodical  renewal,  but  spent  once  for  all  in 
giving  the  land  a  permanent  increase  of  productiveness,  it  ap¬ 
pears  to  me  that  the  return  made  to  such  capital  loses  alto¬ 
gether  the  character  of  profits,  and  is  governed  by  the  prin¬ 
ciples  of  rent.  It  is  true  that  a  landlord  will  not  expend  capital 
in  improving  his  estate,  unless  he  expects  from  the  improve¬ 
ment  an  increase  of  income,  surpassing  the  interest  of  his  out¬ 
lay.  Prospectively,  this  increase  of  income  may  be  regarded 
as  profit ;  but  when  the  expense  has  been  incurred,  and  the 
improvement  made,  the  rent  of  the  improved  land  is  governed 
by  the  same  rules  as  that  of  the  unimproved.  Equally  fertile 
land  commands  an  equal  rent,  whether  its  fertility  is  natural 
or  acquired  ;  and  I  cannot  think  that  the  incomes  of  those  who 
own  the  Bedford  Level  or  the  Lincolnshire  wolds,  ought  to  be 
called  profit  and  not  rent,  because  those  lands  would  have  been 
worth  next  to  nothing  unless  capital  had  been  expended  on 
them.  The  owners  are  not  capitalists,  but  landlords  ;  they  have 
parted  with  their  capital ;  it  is  consumed,  destroyed ;  and 
neither  is,  nor  is  to  be,  returned  to  them,  like  the  capital  of  a 
farmer  or  manufacturer,  from  what  it  produces.  In  lieu  of  it 
they  now  have  land,  of  a  certain  richness,  which  yields  the  same 
rent,  and  by  the  operation  of  the  same  causes,  as  if  it  had  pos¬ 
sessed  from  the  beginning  the  degree  of  fertility  which  has  been 
artificially  given  to  it. 

Some  writers,  in  particular  Mr.  H.  C.  Carey,  take  away,  still 
more  completely  than  I  have  attempted  to  do,  the  distinction 


4i4 


POLITICAL  ECONOMY 


between  these  two  sources  of  rent,  by  rejecting  one  of  them 
altogether,  and  considering  all  rent  as  the  effect  of  capital  ex¬ 
pended.  In  proof  of  this,  Mr.  Carey  contends  that  the  whole 
pecuniary  value  of  all  the  land  in  any  country,  in  England  for 
instance,  or  in  the  United  States,  does  not  amount  to  anything 
approaching  to  the  sum  which  has  been  laid  out,  or  which  it 
would  even  now  be  necessary  to  lay  out,  in  order  to  bring  the 
country  to  its  present  condition  from  a  state  of  primeval  forest. 
This  startling  statement  has  been  seized  on  by  M.  Bastiat  and 
others,  as  a  means  of  making  out  a  stronger  case  than  could 
otherwise  be  made  in  defence  of  property  in  land.  Mr.  Carey’s 
proposition,  in  its  most  obvious  meaning,  is  equivalent  to  say¬ 
ing,  that  if  there  were  suddenly  added  to  the  lands  of  England 
an  unreclaimed  territory  of  equal  natural  fertility,  it  would  not 
be  worth  the  while  of  the  inhabitants  of  England  to  reclaim  it : 
because  the  profits  of  the  operation  would  not  be  equal  to  the 
ordinary  interest  on  the  capital  expended.  To  which  assertion 
if  any  answer  could  be  supposed  to  be  required,  it  would  suffice 
to  remark,  that  land  not  of  equal  but  of  greatly  inferior  qual¬ 
ity  to  that  previously  cultivated,  is  continually  reclaimed  in 
England,  at  an  expense  which  the  subsequently  accruing 
rent  is  sufficient  to  replace  completely  in  a  small  number  of 
years.  The  doctrine,  moreover,  is  totally  opposed  to  Mr. 
Carey’s  own  economical  opinions.  No  one  maintains  more 
strenuously  than  Mr.  Carey  the  undoubted  truth,  that  as  so¬ 
ciety  advances  in  population,  wealth,  and  combination  of  labor, 
land  constantly  rises  in  value  and  price.  This,  however,  could 
not  possibly  be  true  if  the  present  value  of  land  were  less  than 
the  expense  of  clearing  it  and  making  it  fit  for  cultivation ; 
for  it  must  have  been  worth  this  immediately  after  it  was 
cleared,  and  according  to  Mr.  Carey  it  has  been  rising  in  value 
ever  since.  When,  however,  Mr.  Carey  asserts  that  the  whole 
land  of  any  country  is  not  now  worth  the  capital  which  has  been 
expended  on  it,  he  does  not  mean  that  each  particular  estate  is 
worth  less  than  what  has  been  laid  out  in  improving  it,  and 
that,  to  the  proprietors,  the  improvement  of  the  land  has  been, 
on  the  final  result,  a  miscalculation.  He  means,  not  that  the 
land  of  Great  Britain  would  not  now  sell  for  what  has  been  laid 
out  upon  it,  but  that  it  would  not  sell  for  that  amount,  plus 
the  expense  of  making  all  the  roads,  canals,  and  railways.  This 
is  probably  true,  but  is  no  more  to  the  purpose,  and  no  more 


RENTS 


4i5 


important  in  political  economy,  than  if  the  statement  had  been 
that  it  would  not  sell  for  the  sums  laid  out  upon  it  plus  the 
national  debt,  or  plus  the  cost  of  the  French  Revolutionary  war, 
or  any  other  expense  incurred  for  a  real  or  imaginary  public 
advantage.  The  roads,  railways,  and  canals,  were  not  con¬ 
structed  to  give  value  to  land :  on  the  contrary,  their  natural 
effect  was  to  lower  its  value,  by  rendering  other  and  rival  lands 
accessible :  and  the  landholders  of  the  southern  counties  actu¬ 
ally  petitioned  Parliament  against  the  turnpike  roads  on  this 
very  account.  The  tendency  of  improved  communications  is 
to  lower  existing  rents,  by  trenching  on  the  monopoly  of  the 
land  nearest  to  the  places  where  large  numbers  of  consumers 
are  assembled.  Roads  and  canals  are  not  intended  to  raise 
the  value  of  the  land  which  already  supplies  the  markets,  but 
(among  other  purposes)  to  cheapen  the  supply,  by  letting  in 
the  produce  of  other  and  more  distant  lands :  and  the  more 
effectually  this  purpose  is  attained,  the  lower  rent  will  be.  If 
we  could  imagine  that  the  railways  and  canals  of  the  United 
States,  instead  of  only  cheapening  communication,  did  their 
business  so  effectually  as  to  annihilate  cost  of  carriage  alto¬ 
gether,  and  enable  the  produce  of  Michigan  to  reach  the 
market  of  New  York  as  quickly  and  as  cheaply  as  the  produce 
of  Long  Island — the  whole  value  of  all  the  land  of  the  United 
States  (except  such  as  lies  convenient  for  building)  would  be 
annihilated ;  or  rather,  the  best  would  only  sell  for  the  ex¬ 
pense  of  clearing,  and  the  government  tax  of  a  dollar  and  a 
quarter  per  acre ;  since  land  in  Michigan,  equal  to  the  best 
in  the  United  States,  may  be  had  in  unlimited  abundance  by 
that  amount  of  outlay.  But  it  is  strange  that  Mr.  Carey  should 
think  this  fact  inconsistent  with  the  Ricardo  theory  of  rent. 
Admitting  all  that  he  asserts,  it  is  still  true  that  as  long  as  there 
is  land  which  yields  no  rent,  the  land  which  does  yield  rent, 
does  so  in  consequence  of  some  advantage  which  it  enjoys,  in 
fertility  or  vicinity  to  markets,  over  the  other ;  and  the  measure 
of  its  advantage  is  also  the  measure  of  its  rent.  And  the  cause 
of  its  yielding  rent,  is  that  it  possesses  a  natural  monopoly ; 
the  quantity  of  land,  as  favorably  circumstanced  as  itself,  not 
being  sufficient  to  supply  the  market.  These  propositions  con¬ 
stitute  the  theory  of  rent,  laid  down  by  Ricardo ;  and  if  they 
are  true,  I  cannot  see  that  it  signifies  much  whether  the  rent 
which  the  land  yields  at  the  present  time,  is  greater  or  less  than 


416 


POLITICAL  ECONOMY 


the  interest  of  the  capital  which  has  been  laid  out  to  raise  its 
value,  together  with  the  interest  of  the  capital  which  has  been 
laid  out  to  lower  its  value. 

Mr.  Carey’s  objection,  however,  has  somewhat  more  of  in¬ 
genuity  than  the  arguments  commonly  met  with  against  the 
theory  of  rent :  a  theorem  which  may  be  called  the  pons 
asinorum  of  political  economy,  for  there  are,  I  am  inclined  to 
think,  few  persons  who  have  refused  their  assent  to  it  except 
from  not  having  thoroughly  understood  it.  The  loose  and 
inaccurate  way  in  which  it  is  often  apprehended  by  those  who 
affect  to  refute  it,  is  very  remarkable.  Many,  for  instance,  have 
imputed  absurdity  to  Mr.  Ricardo’s  theory,  because  it  is  absurd 
to  say  that  the  cultivation  of  inferior  land  is  the  cause  of  rent 
on  the  superior.  Mr.  Ricardo  does  not  say  that  it  is  the  culti¬ 
vation  of  inferior  land,  but  the  necessity  of  cultivating  it,  from 
the  insufficiency  of  the  superior  land  to  feed  a  growing  popula¬ 
tion  :  between  which  and  the  proposition  imputed  to  him  there 
is  no  less  a  difference  than  that  between  demand  and  supply. 
Others  again  allege  as  an  objection  against  Ricardo,  that  if 
all  land  were  of  equal  fertility,  it  might  still  yield  a  rent.  But 
Ricardo  says  precisely  the  same.  He  says  that  if  all  lands  were 
equally  fertile,  those  which  are  nearer  to  their  market  than 
others,  and  are  therefore  less  burdened  with  cost  of  carriage, 
would  yield  a  rent  equivalent  to  the  advantage ;  and  that  the 
land  yielding  no  rent  would  then  be,  not  the  least  fertile,  but 
the  least  advantageously  situated,  which  the  wants  of  the  com¬ 
munity  required  to  be  brought  into  cultivation.  It  is  also  dis¬ 
tinctly  a  portion  of  Ricardo’s  doctrine,  that  even  apart  from 
differences  of  situation,  the  land  of  a  country  supposed  to  be  of 
uniform  fertility  would,  all  of  it,  on  a  certain  supposition,  pay 
rent :  namely,  if  the  demand  of  the  community  required  that 
it  should  all  be  cultivated,  and  cultivated  beyond  the  point  at 
which  a  further  application  of  capital  begins  to  be  attended  with 
a  smaller  proportional  return.  It  would  be  impossible  to  show 
that,  except  by  forcible  exaction,  the  whole  land  of  a  country 
can  yield  a  rent  on  any  other  supposition. 

§  6.  After  this  view  of  the  nature  and  causes  of  rent,  let  us 
turn  back  to  the  subject  of  profits,  and  bring  up  for  reconsid¬ 
eration  one  of  the  propositions  laid  down  in  the  last  chapter. 
We  there  stated,  that  the  advances  of  the  capitalist,  or  in  other 


RENTS 


417 


words,  the  expenses  of  production,  consist  solely  in  wages  of 
labor ;  that  whatever  portion  of  the  outlay  is  not  wages,  is  pre¬ 
vious  profit,  and  whatever  is  not  previous  profit,  is  wages. 
Rent,  however,  being  an  element  which  it  is  impossible  to  re¬ 
solve  into  either  profit  or  wages,  we  were  obliged,  for  the  mo¬ 
ment,  to  assume  that  the  capitalist  is  not  required  to  pay  rent 
— to  give  an  equivalent  for  the  use  of  an  appropriated  natural 
agent :  and  I  undertook  to  show  in  the  proper  place,  that  this 
is  an  allowable  supposition,  and  that  rent  does  not  really  form 
any  part  of  the  expenses  of  production,  or  of  the  advances  of 
the  capitalist.  The  grounds  on  which  this  assertion  was  made 
are  now  apparent.  It  is  true  that  all  tenant  farmers,  and  many 
other  classes  of  producers,  pay  rent.  But  we  have  now  seen, 
that  whoever  cultivates  land,  paying  a  rent  for  it,  gets  in  re¬ 
turn  for  his  rent  an  instrument  of  superior  power  to  other  in¬ 
struments  of  the  same  kind  for  which  no  rent  is  paid.  The 
superiority  of  the  instrument  is  in  exact  proportion  to  the  rent 
paid  for  it.  If  a  few  persons  had  steam  engines  of  superior 
power  to  all  others  in  existence,  but  limited  by  physical  laws 
to  a  number  short  of  the  demand,  the  rent  which  a  manufact¬ 
urer  would  be  willing  to  pay  for  one  of  these  steam  engines 
could  not  be  looked  upon  as  an  addition  to  his  outlay,  because 
by  the  use  of  it  he  would  save  in  his  other  expenses  the  equiva¬ 
lent  of  what  it  cost  him :  without  it  he  could  not  do  the  same 
quantity  of  work,  unless  at  an  additional  expense  equal  to  the 
rent.  The  same  thing  is  true  of  land.  The  real  expenses  of 
production  are  those  incurred  on  the  worst  land,  or  by  the 
capital  employed  in  the  least  favorable  circumstances.  This 
land  or  capital  pays,  as  we  have  seen,  no  rent :  but  the  ex¬ 
penses  to  which  it  is  subject,  cause  all  other  land  or  agricultural 
capital  to  be  subjected  to  an  equivalent  expense  in  the  form  of 
rent.  Whoever  does  pay  rent,  gets  back  its  full  value  in  extra 
advantages,  and  the  rent  which  he  pays  does  not  place  him  in  a 
worse  position  than,  but  only  in  the  same  position  as,  his  fel¬ 
low-producer  who  pays  no  rent,  but  whose  instrument  is  one 
of  inferior  efficiency. 

We  have  now  completed  the  exposition  of  the  laws  which 
regulate  the  distribution  of  the  produce  of  land,  labor,  and 
capital,  as  far  as  it  is  possible  to  discuss  those  laws  indepen¬ 
dently  of  the  instrumentality  by  which  in  a  civilized  society  the 
Vol.  I. — 27 


418 


POLITICAL  ECONOMY 


distribution  is  effected ;  the  machinery  of  Exchange  and  Price. 
The  more  complete  elucidation  and  final  confirmation  of  the 
laws  which  we  have  laid  down,  and  the  deduction  of  their  most 
important  consequences,  must  be  preceded  by  an  explanation 
of  the  nature  and  working  of  that  machinery — a  subject  so  ex¬ 
tensive  and  complicated  as  to  require  a  separate  Book. 


I 


CHOICE  EXAMPLES  OF  EARLY  PRINTING  AND 

ENGRAVING. 

Fac-similes  from  Rare  and  Curious  Books. 


EARLY  VENETIAN  PRINTING . 

Fac-simile  of  the  title-page  of  the  Thoscanella  della  Musica  of  Pietro  Aaron 
Fiorentino.  Printed  at  Venice  in  1523  by  Bernardo  e  Matteo  de  Vitali.  A  copy  oi 
the  work  is  preserved  in  the  Biblioteca  Marciana. 


*  n 


M 


v’A./’j'W-  k/^vV|ivMl  (d\  - 

THOSCANELLO  DE  LA 
MVSICA  D1  MESSER 

PIETRO  AARON  FIO/ 
RENTINO  CANO/ 

NICO  DA  RI/ 

MINT. 

CON  PRIVILEGIO. 


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BOOK  III 


EXCHANGE 


Chapter  I. — Of  Value 


THE  subject  on  which  we  are  now  about  to  enter  fills 
so  important  and  conspicuous  a  position  in  apolitical 
economy,  that  in  the  apprehension  of  some  thinkers 
its  boundaries  confound  themselves  with  those  of  the  science 
itself.  One  eminent  writer  has  proposed  as  a  name  for  Political 
Economy,  “  Catallactics,”  or  the  science  of  exchanges :  by 
others  it  has  been  called  the  Science  of  Values.  If  these  de¬ 
nomination^  to  me  logically  correct,  I  must  have 

placed  the  discussion  oflhe  elementary  laws  of  value  at  the 
commencement  of  our  inquiry,  instead  ot  postponing  it  to  tKe 
TKircI  Part;  and  the  possibility  of  so  long  deferring  it  is  alone 
^sufficient  prooTthat  this  view  of  the  nature  of  Political  Econ¬ 

omy  is  too  confined.  It  is  true  that  in  the  preceding  Books 
we  have  not  escaped  the  necessity  of  anticipating  some  small 
portion  of  the  theory  of  Value,  especially  as  to  the  value  of 
labor  and  of  land.  It  is  nevertheless  evident,  that  of  the  two 


great  departments  of  Political  Economy,  the  production  of 
wealth  and  its  distribution,  the  consideration  ot  Value  has  to 
do  with  the  latter  alone ;  and  with  that  onlyVo  farlis  compe- 
tition.  and  not  usage  or  custom,  is  the  distributing  agency. 
The  conditions  and  laws  of  Production  would  be  the  same~as 
they  are,  if  the  arrangements  of  society  did  not  depend  on  ex¬ 
change,  or  did  not  admit  of  it.  Even  in  the  present  system  of 
industrial  life,  in  which  employments  are  minutely  subdivided, 
and  all  concerned  in  production  depend  for  their  remuneration 
on  the  price  of  a  particular  commodity,  exchange  is  not  the 
fundamental  law  of  the  distribution  of  the  produce,  no  more 
than  roads  and  carriages  are  the  essential  laws  of  motion,  but 
merely  a  part  of  the  machinery  for  effecting  it.  To  confound 
these  ideas,  seems  to  me  not  only  a  logical,  but  a  practical 

419 


420 


POLITICAL  ECONOMY 


blunder.  It  is  a  case  of  the  error  too  common  in  political  econ- 
omy,  of  not  distinguishing  between  necessities  arising  from  the 
nature  of  things,  and  those  created  bv  social  arrangements,: 
an  error,  which  appears  to  me  to  be  at  all  times  producing  two 
opposite  mischiefs ;  on  the  one  hand,  causing  political  econ¬ 
omists  to  class  the  merely  temporary  truths  of  their  subject 
among  its  ^permanent  and  universal  laws;  and  on  the  other, 
leading  many  persons  to  mistake  the  permanent  laws  of  Pro¬ 
duction  (such  as  those  on  which  the  necessity  is  grounded  of 
restraining  population)  for  temporary  accidents  arising  from 
the  existing  constitution  of  society — which  those  who  would 
frame  a  new  system  of  social  arrangements,  are  at  liberty  to 
disregard. 

In  a  state  of  society,  however,  in  which  the  industrial  system 
is  entirely  founded  on  purchase  and  sale,  each  individual,  for 
the  most  part,  living  not  on  things  in  the  production  of  which 
he  himself  bears  a  part,  but  on  things  obtained  by  a  double 
exchange,  a  sale  followed  by  a  purchase — the  question  of  Value 
is  fundamental.  Almost  every  speculation  respecting  the  eco¬ 
nomical  interests  of  a  society  thus  constituted,  implies  some 
theory  of  Value:  the  smallest  error  on  that  subject  infects  with 
corresponding  error  all  our  other  conclusions ;  and  anything 
vague  or  misty  in  our  conception  of  it,  creates  confusion  and 
uncertainty  in  everything  else.  Happily,  there  is  nothing  in 
the  laws  of  Value  which  remains  for  the  present  or  any  future 
writer  to  clear  up;  the  theory  of  the  subject  is  complete:  the 
only  difficulty  to  be  overcome  Is  that  of  so  stating  it  as  to  solve 

by  anticipation  the  chief  perplexities  which  occur  in  applying 

it:  and  to  do  this,  some  minuteness  of  exposition,  and  con- 
siderable  demands  on  the  patience  of  the  reader,  are  unavoid¬ 
able  _  He  will  be  amply  repaid,  however,  (if  a  stranger  to  these 
inquiries)  by  the  ease  and  rapidity  with  which  a  thorough  un¬ 
derstanding  of  this  subject  will  enable  him  to  fathom  most  of 
the  remaining  questions  of  political  economy. 

§  2.  We  must  begin  by  settling  our  phraseology.  Adam 
Smith,  in  a  passage  often  quoted,  has  touched  upon  the  most 
obvious  ambiguity  of  the  word  value ;  which,  in  one  of  its 
senses,  signifies  usefulness,  in  another,  power  of  purchasing; 
in  his  own  language,  value  in  use,  and  value  in  exchange.  But 
(as  Mr.  De  Quincey  has  remarked)  in  illustrating  this  double 
meaning,  Adam  Smith  has  himself  fallen  into  another  am- 


VALUE 


421 


biguity.  Things  (he  says)  which  have  the  greatest  value  in  use 
have  often  little  or  no  value  in  exchange ;  which  is  true,  since 
that  which  can  be  obtained  without  labor  or  sacrifice  will  com¬ 
mand  no  price,  however  useful  or  needful  it  may  be.  But  he 
proceeds  to  add,  that  things  which  have  the  greatest  value  in 
exchange,  as  a  diamond  for  example,  may  have  little  or  no 
value  in  use.  This  is  employing  the  word  use,  not  in  the  sense 
in  which  political  economy  is  concerned  with  it,  but  in  that 
other  sense  in  which  use  is  opposed  to  pleasure.  Political 
economy  has  nothing  to  do  with  the  comparative  estimation 

of  different  uses  in  the  judgment  of  a  philosopher  or  of  a  moral- 

ist7~  Tfie  use  of  a  thing,  in  political  economy,  means  its  capacity 
to  satisfy  a  desire,  or  serve  a  purpose.  Diamonds  have  this 
capacity  in  a  high  degree,  and  unless  they  had  it,  would  not 
bear  any  price.  Value  in  use,  or  as  Mr.  De  Quincey  calls  it, 
teleologic  value,  is  the  extreme  limit  of  value  in  exchange.  The 
exchange  value  of  a  thing  may  fair  short,  to  any  amomrt,  of  its 
value  in  use ;  but  that  it  can  ever  exceed  the  value  in  use,  im¬ 
plies  a  contradiction ;  it  supposes  that  persons  will  give,  to 
possess  a  thing,  more  than  the  utmost  value  which  they  them¬ 
selves  put  upon  it,  as  a  means  of  gratifying  their  inclinations. 

The  word  Value,  when  used  without  adjunct,  always  means,  in 
political  economy,  value  in  exchange;  or  as  it  has  been  called 
by  Adam  Smith  and  his  successors,  exchangeable  value,  a  phrase 
which  no  amount  of  authority  that  can  be  quoted  for  it  can 
make  other  than  bad  English.  Mr.  De  Quincey  substitutes  the 
term  Exchange  Value,  which  is  unexceptionable. 

Exchange  value  requires  to  be  distinguished  from  Price.  The 
words  Value  and  Price  were  used  as  synonymous  by  the  early 
political  economists,  and  are  not  always  discriminated  even  by 
Ricardo.  But  the  most  accurate  modern  writers,  to  avoid  the 
wasteful  expenditure  of  two  good  scientific  terms  on  a  single 
idea,  have  employed  Price  to  express  the  value  of  a  thing  in 
relation  to  money;  the  quantity  of  money  for  which  it  will  ex¬ 
change.  By  the  price  of  a  thing,  therefore,  we  shall  henceforth 
understand  its  value  in  money;  by  the  value,  or  exchange  value 
of  a  thing,  its  general  power  of  purchasing;  the  command 
which  its  possession  gives  over  purchasable  commodities  in 
general. 

§  3.  But  here  a  fresh  demand  for  explanation  presents  itself. 
What  is  meant  by  command  over  commodities  in  general?  The 


422 


POLITICAL  ECONOMY 


same  thing  exchanges  for  a  great  quantity  of  some  commodities, 
and  for  a  very  small  quantity  of  others.  A  suit  of  clothes  ex¬ 
changes  for  a  great  quantity  of  bread,  and  for  a  very  small 
quantity  of  precious  stones.  The  value  of  a  thing  in  exchange 
for  some  commodities  may  be  rising,  for  others  falling.  A  coat 
may  exchange  for  less  bread  this  year  than  last,  if  the  harvest 
has  been  bad,  but  for  more  glass  or  iron,  if  a  tax  has  been  taken 
off  those  commodities,  or  an  improvement  made  in  their  manu¬ 
facture.  Has  the  value  of  the  coat,  under  these  circumstances, 
fallen  or  risen?  It  is  impossible  to  say:  all  that  can  be  said  is, 
that  it  has  fallen  in  relation  to  one  thing,  and  risen  in  respect 
to  another.  But  there  is  another  case,  in  which  no  one  would 
have  any  hesitation  in  saying  what  sort  of  change  had  taken 
place  in  the  value  of  the  coat:  namely,  if  the  cause  in  which  the 
disturbance  of  exchange  values  originated,  was  something  di¬ 
rectly  affecting  the  coat  itself,  and  not  the  bread,  or  the  glass. 
Suppose,  for  example,  that  an  invention  had  been  made  in  ma¬ 
chinery,  by  which  broadcloth  could  be  woven  at  half  the  former 
cost.  The  effect  of  this  would  be  to  lower  the  value  of  a  coat, 
and  if  lowered  by  this  cause,  it  would  be  lowered  not  in  relation 
to  bread  only  or  to  glass  only,  but  to  all  purchasable  things, 
except  such  as  happened  to  be  affected  at  the  very  time  by  a 
similar  depressing  cause.  We  should  therefore  say  that  there 
had  been  a  fall  in  the  exchange  value  or  general  purchasing 
power  of  a  coat.  The  idea  of  general  exchange  value  originates 
in  the  fact,  that  there  really  are  causes  which  tend  to  alter  the 
value  of  a  thing  in  exchange  for  things  generally,  that  is,  for 
all  things  which  are  not  themselves  acted  upon  by  causes  of 
similar  tendency. 

In  considering  exchange  value  scientifically,  it  is  expedient 
to  abstract  from  it  all  causes  except  those  which  originate  in 
the  very  commodity  under  consideration.  Those  which  origi¬ 
nate  in  the  commodities  with  which  we  compare  it,  affect  its 
value  in  relation  to  those  commodities;  but  those  which  origi¬ 
nate  in  itself,  affect  its  value  in  relation  to  all  commodities.  In 
order  the  more  completely  to  confine  our  attention  to  these  last, 
it  is  convenient  to  assume  that  all  commodities  but  the  one  in 
question  remain  invariable  in  their  relative  values.  When  we 
are  considering  the  causes  which  raise  or  lower  the  value  of 
corn,  we  suppose  that  woollens,  silks,  cutlery,  sugar,  timber,  etc., 
while  varying  in  their  power  of  purchasing  corn,  remain  con- 


VALUE 


423 


stant  in  the  proportions  in  which  they  exchange  for  one  another. 
On  this  assumption,  any  one  of  them  may  be  taken  as  a  repre¬ 
sentative  of  all  the  rest:  since  in  whatever  manner  corn  varies 
in  value  with  respect  to  any  one  commodity,  it  varies  in  the  same 
manner  and  degree  with  respect  to  every  other;  and  the  upward 
or  downward  movement  of  its  value  estimated  in  some  one  thing, 
is  all  that  needs  be  considered.  Its  money  value,  therefore,  or 
price,  will  represent  as  well  as  anything  else  its  general  exchange 
value,  or  purchasing  power;  and  from  an  obvious  convenience, 
will  often  be  employed  by  us  in  that  representative  character; 
with  the  proviso  that  money  itself  do  not  vary  in  its  general  pur¬ 
chasing  power,  but  that  the  prices  of  all  things,  other  than  that 
which  we  happen  to  be  considering,  remain  unaltered. 

§  4.  The  distinction  between  Value  and  Price,  as  we  have 
now  defined  them,  is  so  obvious,  as  scarcely  to  seem  in  need  of 
any  illustration.  But  in  political  economy  the  greatest  errors 
arise  from  overlooking  the  most  obvious  truths.  Simple  as  this 
distinction  is,  it  has  consequences  with  which  a  reader  unac¬ 
quainted  with  the  subject  would  do  well  to  begin  early  by  mak¬ 
ing  himself  thoroughly  familiar.  The  following  is  one  of  the 
principal.  There  is  such  a  thing  as  a  general  rise  of  prices.  All 
commodities  may  rise  in  their  money  price.  But  there  cannot 
be  a  general  rise  of  values.  ,It  is  a  contradiction  in  terms.  A 
can  only  rise  in  value  by  exchanging  for  a  greater  quantity  of 
B  and  C;  in  which  case  these  must  exchange  for  a  smaller 
quantity  of  A.  All  things  cannot  rise  relatively  to  one  another. 
If  one-half  of  the  commodities  in  the  market  rise  in  exchange 
value,  the  very  terms  imply  a  fall  of  the  other  half ;  and  recipro¬ 
cally,  the  fall  implies  a  rise.  Things  which  are  exchanged  for 
one  another  can  no  more  all  fall,  or  all  rise,  than  a  dozen  runners 
can  each  outrun  all  the  rest,  or  a  hundred  trees  all  overtop  one 
another.  Simple  as  this  truth  is,  we  shall  presently  see  that  it  is 
lost  sight  of  in  some  of  the  most  accredited  doctrines  both  of 
theorists  and  of  what  are  called  practical  men.  And  as  a  first 
specimen,  we  may  instance  the  great  importance  attached  in 
the  imagination  of  most  people  to  a  rise  or  fall  of  general  prices. 
Because  when  the  price  of  any  one  commodity  rises,  the  cir¬ 
cumstance  usually  indicates  a  rise  of  its  value,  people  have  an 
indistinct  feeling  when  all  prices  rise,  as  if  all  things  simultane¬ 
ously  had  risen  in  value,  and  all  the  possessors  had  become  en¬ 
riched.  That  the  money  prices  of  all  things  should  rise  or  fall, 


POLITICAL  ECONOMY 


424 

provided  they  all  rise  or  fall  equally,  is,  in  itself,  and  apart  from 
existing  contracts,  of  no  consequence.  It  affects  nobody’s 
wages,  profits,  or  rent.  Everyone  gets  more  money  in  the  one 
case  and  less  in  the  other;  but  of  all  that  is  to  be  bought  with 
money  they  get  neither  more  nor  less  than  before.  It  makes  no 
other  difference  than  that  of  using  more  or  fewer  counters  to 
reckon  by.  The  only  thing  which  in  this  case  is  really  altered 
in  value,  is  money;  and  the  only  persons  who  either  gain  or  lose 
are  the  holders  of  money,  or  those  who  have  to  receive  or  to  pay 
fixed  sums  of  it.  There  is  a  difference  to  annuitants  and  to  cred¬ 
itors  the  one  way,  and  to  those  who  are  burthened  with  annui¬ 
ties,  or  with  debts,  the  contrary  way.  There  is  a  disturbance,  in 
short,  of  fixed  money  contracts;  and  this  is  an  evil,  whether  it 
takes  place  in  the  debtor’s  favor  or  in  the  creditor’s.  But  as 
to  future  transactions  there  is  no  difference  to  any  one.  Let  it 
therefore  be  remembered  (and  occasions  will  often  rise  of  calling 
it  to  mind)  that  a  general  rise  or  a  general  fall  of  values  is  a  con¬ 
tradiction;  and  that  a  general  rise  or  a  general  fall  of  prices  is 
merely  tantamount  to  an  alteration  in  the  value  of  money,  and  is 
a  matter  of  complete  indifference,  save  in  so  far  as  it  affects  ex¬ 
isting  contracts  for  receiving  and  paying  fixed  pecuniary 
amounts,  and  (it  must  be  added)  as  it  affects  the  interests  of  the 
producers  of  money. 

§  5.  Before  commencing  the  inquiry  into  the  laws  of  value  and 
price,  I  have  one  further  observation  to  make.  I  must  give 
warning,  once  for  all,  that  the  cases  I  contemplate  are  those  in 
which  values  and  prices  are  determined  bv  competition  alone. 
In  so  far  only  as  they  are  thus  determined,  can  they  be  reduced 
Iq  any  assignable  law.  The  buyers  must  be  supposed  as  studious 
to  buy  cheap,  as  the  sellers  to  sell  dear.  The  valuesand  prices, 
therefore,  to  which  our  conclusions  apply,  are  mercantile  values 
and  prices;  such  prices  as  are  quoted  in  price-currents;  prices 
in  the  wholesale  markets,  in  which  buying  as  well  as  selling  is 
a  matter  of  business;  in  which  the  buyers  take  pains  to  know, 
and  generally  do  know,  the  lowest  price  at  which  an  article  of 
a  given  quality  can  be  obtained;  and  in  which,  therefore,  the 
axiom  is  true,  that  there  cannot  be  for  the  same  article,  of  the 
same  quality,  two  prices  in  the  same  market.  Our  propositions 
will  be  true  in  a  much  more  qualified  sense,  of  retail  prices^  the 
prices  paid  in  shops  for  articles  of  personal  consumption.  For 
such  things  there  often  are  not  merely  two,  but  many  prices, 


VALUE 


425 


in  different  shops,  or  even  in  the  same  shop ;  habit  and  accident 
having  as  much  to  do  in  the  matter  as  general  causes.  Pur¬ 
chases  for  private  use,  even  by  people  in  business,  are  not  always 
made  on  business  principles:  the  feelings  which  come  into  play 
in  the  operation  of  getting,  and  in  that  of  spending  their  in¬ 
come,  are  often  extremely  different.  Either  from  indolence,  or 
carelessness,  or  because  people  think  it  fine  to  pay  and  ask  no 
questions,  three-fourths  of  those  who  can  afford  it  give  much 
higher  prices  than  necessary  for  the  things  they  consume;  while 
the  poor  often  do  the  same  from  ignorance  and  defect  of  judg¬ 
ment,  want  of  time  for  searching  and  making  inquiry,  and  not 
unfrequently  from  coercion,  open  or  disguised.  For  these  rea¬ 
sons,  retail  prices  do  not  follow  with  all  the  regularity  which 
might  be  expected,  the  action  of  the  causes  which  determine 
wholesale  prices.  The  influence  of  those  causes  is  ultimately 
felt  in  the  retail  markets,  and  is  the  real  source  of  such  variations 
in  retail  prices  as  are  of  a  general  and  permanent  character. 
But  there  is  no  regular  or  exact  correspondence.  Shoes  of 
equally  good  quality  are  sold  in  different  shops  at  prices  which 
differ  considerably;  and  the  price  of  leather  may  fall  without 
causing  the  richer  class  of  buyers  to  pay  less  for  shoes.  Never¬ 
theless,  shoes  do  sometimes  fall  in  price;  and  when  they  do,  the 
cause  is  always  some  such  general  circumstance  as  the  cheapen¬ 
ing  of  leather:  and  when  leather  is  cheapened,  even  if  no  differ¬ 
ence  shows  itself  in  shops  frequented  by  rich  people,  the  artisan 
and  the  laborer  generally  get  their  shoes  cheaper,  and  there  is  a 
visible  diminution  in  the  contract  prices  at  which  shoes  are  de¬ 
livered  for  the  supply  of  a  workhouse  or  of  a  regiment.  In  all 
reasoning  about  prices,  the  proviso  must  be  understood,  “  sup¬ 
posing  all  parties  to  take  care  of  their  own  interest.”  Inatten¬ 
tion  to  these  distinctions  has  led  to  improper  applications  of  the 
abstract  principles  of  political  economy,  and  still  oftener  to  an 
undue  discrediting  of  those  principles,  through  their  being  com¬ 
pared  with  a  different  sort  of  facts  from  those  which  they  con¬ 
template,  or  which  can  fairly  be  expected  to  accord  with  them. 


426 


POLITICAL  ECONOMY 


Chapter  II. — Of  Demand  and  Supply,  in  their  Relation  to  Value 

§  i.  That  a  thing  may  have  any  value  in  exchange,  two  con¬ 
ditions  are  necessary.  It  must  be  of  some  use;  that  is  (as  al¬ 
ready  explained)  it  must  conduce  to  some  purpose,  satisfy  some 
desire.  No  one  will  pay  a  price,  or  part  with  anything  which 
serves  some  of  his  purposes,  to  obtain  a  thing  which  serves  none 
of  them.  But,  secondly,  the  thing  must  not  only  have  some 
utility,  there  must  also  be  some  difficulty  in  its  attainment. 
“  Any  article  whatever,”  says  Mr.  De  Quincey,*  “  to  obtain  that 
artificial  sort  of  value  which  is  meant  by  exchange  value,  must 
begin  by  offering  itself  as  a  means  to  some  desirable  purpose; 
and  secondly,  even  though  possessing  incontestably  this  pre¬ 
liminary  advantage,  it  will  never  ascend  to  an  exchange  value  in 
cases  where  it  can  be  obtained  gratuitously  and  without  effort; 
of  which  last  terms  both  are  necessary  as  limitations.  For  often 
it  will  happen  that  some  desirable  object  may  be  obtained  gra¬ 
tuitously;  stoop,  and  you  gather  it  at  your  feet;  but  still,  be¬ 
cause  the  continued  iteration  of  this  stooping  exacts  a  laborious 
effort,  very  soon  it  is  found,  that  to  gather  for  yourself  virtually 
is  not  gratuitous.  In  the  vast  forests  of  the  Canadas,  at  intervals, 
wild  strawberries  may  be  gratuitously  gathered  by  shiploads: 
yet  such  is  the  exhaustion  of  a  stooping  posture,  and  of  a  labor 
so  monotonous,  that  everybody  is  soon  glad  to  resign  the  ser¬ 
vice  into  mercenary  hands.” 

As  was  pointed  out  in  the  last  chapter,  the  utility  of  a  thing 
in  the  estimation  of  a  purchaser,  is  the  extreme  limit  of  its  ex¬ 
change  value:  higher  the  value  cannot  ascend;  peculiar  cir¬ 
cumstances  are  required  to  raise  it  so  high.  This  topic  is  hap¬ 
pily  illustrated  by  Mr.  De  Quincey.  “  Walk  into  almost  any 
possible  shop,  buy  the  first  article  you  see:  what  will  determine 
its  price?  In  the  ninety-nine  cases  out  of  a  hundrecT,  simply 
the  element  D — difficulty  of  attainment.  The  other  element  U, 
or  intrinsic  utility,  will  be  perfectly  inoperative.  Let  the  thing 
(measured  by  its  uses)  be,  for  your  purposes,  worth  ten  guineas, 
so  that  you  would  rather  give  ten  guineas  than  lose  it;  yet,  if 
the  difficulty  of  producing  it  be  only  worth  one  guinea,  one 
guinea  is  the  price  which  it  will  bear.  But  still  not  the  less, 
though  U  is  inoperative,  can  U  be  supposed  absent?  By  no 
possibility;  for,  if  it  had  been  absent,  assuredly  you  would  not 

*  “  Logic  of  Political  Economy,”  p.  13. 


DEMAND  AND  SUPPLY 


427 


have  bought  the  article  even  at  the  lowest  price.  U  acts  upon 
you,  though  it  does  not  act  upon  the  price.yVOn  the  other  hand, 
in  the  hundredth  case,  we  will  suppose  me  circumstances  re¬ 
versed;  you  are  on  Lake  Superior  in  a  steamboat,  making  your 
way  to  an  unsettled  region  800  miles  ahead  of  civilization,  and 
consciously  with  no  chance  at  all  of  purchasing  any  luxury  what¬ 
soever,  little  luxury  or  big  luxury,  for  the  space  of  ten  years  to 
come.  One  fellow-passenger,  whom  you  will  part  with  before 
sunset,  has  a  powerful  musical  snuff-box;  knowing  by  expe¬ 
rience  the  power  of  such  a  toy  over  your  own  feelings,  the  magic 
with  which  at  times  it  lulls  your  agitations  of  mind,  you  are 
vehemently  desirous  to  purchase  it.  In  the  hour  of  leaving  Lon¬ 
don  you  had  forgot  to  do  so;  here  is  a  final  chance.  But  the 
owner,  aware  of  your  situation  not  less  than  yourself,  is  deter¬ 
mined  to  operate  by  a  strain  pushed  to  the  very  uttermost  upon 
U,  upon  the  intrinsic  worth  of  the  article  in  your  individual  esti¬ 
mate  for  your  individual  purposes.  He  will  not  hear  of  D  as 
any  controlling  power  or  mitigating  agency  in  the  case;  and 
finally,  although  at  six  guineas  apiece  in  London  or  Paris  you 
might  have  loaded  a  wagon  with  such  boxes,  you  pay  sixty 
rather  than  lose  it  when  the  last  knell  of  the  clock  has  sounded, 
which  summons  you  to  buy  now  or  to  forfeit  forever.  Here, 
as  before,  only  one  element  is  operative:  before  it  was  D,  now 
it  is  U.  But  after  all,  D  was  not  absent,  though  inoperative. 
The  inertness  of  D  allowed  U  to  put  forth  its  total  effect.  The 
practical  compression  of  D  being  withdrawn,  U  springs  up  like 
water  in  a  pump  when  released  from  the  pressure  of  air.  Yet 
still  that  D  was  present  to  your  thoughts,  though  the  price  was 
otherwise  regulated,  is  evident;  both  because  U  and  D  must 
coexist  in  order  to  found  any  case  of  exchange  value  whatever, 
and  because  undeniably  you  take  into  very  particular  considera¬ 
tion  this  D,  the  extreme  difficulty  of  attainment  (which  here  is 
the  greatest  possible,  viz.  an  impossibility)  before  you  consent 
to  have  the  price  racked  up  to  U.  The  special  D  has  vanished; 
but  it  is  replaced  in  your  thoughts  by  an  unlimited  D.  Un¬ 
doubtedly  you  have  submitted  to  U  in  extremity  as  the  regulat¬ 
ing  force  of  the  price;  but  it  was  under  a  sense  of  D’s  latent  pres¬ 
ence.  Yet  D  is  so  far  from  exerting  any  positive  force,  that  the 
retirement  of  D  from  all  agency  whatever  on  the  price — this  it  is 
which  creates  as  it  were  a  perfect  vacuum,  and  through  that 
vacuum  U  rushes  up  to  its  highest  and  ultimate  gradation.” 


428 


POLITICAL  ECONOMY 


ise,  in  which  the  value  is  wholly  regulated  by  the  ne¬ 
cessities  or  desires  of  the  purchaser,  jsthe  case  of  shj£t  and  ab- 
jolu^g||monogol y ;  in  which,  the  article  aefft^'clTeing 
tainable  from  one  person,  he  can  exact  any  equivalent,  short  of 
the  point  at  which  no  purchaser  could  be  found.  But  it  is  not 
a  necessary  consequence,  even  of  complete  monopoly,  that  the 
value  should  be  forced  up  to  this  ultimate  limit:  as  will  be  seen 
when  we  have  considered  the  law  of  value  in  so  far  as  depend¬ 
ing  on  the  other  element,  difficulty  of  attainment. 

§  2.  The  difficulty  of  attainment  which  determines  value,  is 
not  always  the  same  kind  of  difficulty.  It  sometimes  consists  in 
an  jLbsolute  limitation  of  the  supply.  There  are  things  of  which 
it  is  physically  impossible  to  increase  the  quantity  beyond  cer¬ 
tain  narrow  limits.  Such  are  those  wines  which  can  be  grown 
only  in  peculiar  circumstances  of  soil,  climate,  and  exposure. 
Such  also  are  ancient  sculptures;  pictures  by  old  masters;  rare 
books  or  coins,  or  other  articles  of  antiquarian  curiosity. 
Among  such  may  also  be  reckoned  houses  and  building-ground, 
in  a  town  of  definite  extent  (such  as  Venice,  or  any  fortified  town 
where  fortifications  are  necessary  to  security);  the  most  de¬ 
sirable  sites  in  any  town  whatever;  houses  and  parks  peculiarly 
favored  by  natural  beauty,  in  places  where  that  advantage  is  un¬ 
common.  Potentially,  all  land  whatever  is  a  commodity  of  this 
class;  and  might  be  practically  so,  in  countries  fully  occupied 
and  cultivated. 

But  there  is  another  category  (embracing  the  majority  of  aft 
firings  that  are  bought  and  sold,)  in  which  the  obstacle  to  at¬ 
tainment  consists  only  in  the  labor  and  expense  requisite  to 
produce  the  commodity.  Without  a  certain  labor  and  expense 
it  cannot  be  had:  but  when  any  one  is  willing  to  incur  these, 
there  needs  bejio  limit  to  the  multiplication  of  the  product..  If 
there  were  laborers  enough  and  machinery  enough,  cottons, 
woollens,  or  linens  might  be  produced  by  thousands  of  yards  for 
every  single  yard  now  manufactured.  There  would  be  a  point, 
no  doubt,  where  further  increase  would  be  stopped  by  the  in¬ 
capacity  of  the  earth  to  afford  more  of  the  material.  But  there 
is  no  need,  for  any  purpose  of  political  economy,  to  contemplate 
a  time  when  this  ideal  limit  could  become  a  practical  one. 

There  is  a  third  case,  intermediate  between  the  two  preceding, 
and  rather  more  complex,  which  I  shall  at  present  merely  indi¬ 
cate,  but  the  importance  of  which  in  political  economy  is  ex- 


DEMAND  AND  SUPPLY 


429 


tremely  great.  There  are  commodities  which  can  be  multiplied 
to  an  indefinite  extent  by  Tabor  ancTexpenditure.^but  not  by  a, 
fixed  amount  of  labor  and  expenditure.  Only  a  limited  quantity 
can  be  produced  at  a  given  cost;  if  more  is  wanted,  it  must  be 
produced  at  a  greater  cost.  To  this  class,  as  has  been  often  re¬ 
peated,  agricultural  produce  belongs ;  and  generally  all  the  rude 
produce  of  the  earth;  and  this  peculiarity  is  a  source  of  very 
important  consequences;  one  of  which  is  the  necessity  of  a 
limit  to  population :  and  another,  the  payment  of  rent. 

§  3.  These  being  the  three  classes,  in  one  or  other  of  which 
all  things  that  are  brought  and  sold  must  take  their  place,  we 
shall  consider  them  in  their  order.  And  first,  of  things  abso¬ 
lutely  limited  in  quantity,  such  as  ancient  sculptures  or  pictures. 

Of  such  things  it  is  commonly  said,  that  their  value  depends 
upon  their  scarcity:  but  the  expression  is  not  sufficiently  defi¬ 
nite  to  serve  our  purpose.  Others  say,  with  somewhat  greater 
precision,  that  the  value  depends  on  the  demand  and  the  supply. 
But  even  this  statement  requires  much  explanation,  to  make  it 
a  clear  exponent  of  the  relation  between  the  value  of  a  thing, 
and  the  causes  of  which  that  value  is  an  effect. 

The.  supply  of  a  commodity  is  an  intelligible  expression:  it 
Xneans  the  quantity  offered  for  sale;  the  quantity  that  is  to  be 

had,  at  a  given  time  and  place,  by  those,  who  wish  to  purchase 
jt.  But  what  is  meant  by  the  demand?  Not  the  mere  desire  for 
the  commodity.  A  beggar  may  desire  a  diamond;  but  his  desire, 
however  great,  will  have  no  influence  on  the  price.  Writers 
have  therefore  given  a  more  limited  sense  to  demand,  and  have 
defined  it,  the  wish  to  possess,  combined  with  the  power  of  pur¬ 
chasing.  To  distinguish  demand  in  this  technical  sense,  from 
the  demand  which  is  synonymous  with  desire,  they  call  the  for¬ 
mer  effectual  demand.*  After  this  explanation,  is  it  usually 
supposed  that  there  remains  no  further  difficulty,  and  that  the 
value  depends  upon  the  ratio  between  the  effectual  demand,  as 
thus  defined,  and  the  supply. 

These  phrases,  however,  fail  to  satisfy  anyone  who  requires 
clear  ideas,  and  a  perfectly  precise  expression  of  them.  Some 
confusion  must  always  attach  to  a  phrase  so  inappropriate  as 
that  of  a  ratio  between  two  things  not  of  the  same  denomina- 

*  Adam  Smith,  who  introduced  the  price,  that  is,  the  price  which  will  enable 
expression  “  effectual  demand,”  em-  it  to  be  permanently  produced  and 
ployed  it  to  denote  the  demand  of  those  brought  to  market.— See  his  chapter  on 
who  are  willing  and  able  to  give  for  the  “  Natural  and  Market  Price  ”  (book  i. 
commodity  what  he  calls  its  natural  chap.  7.) 


43° 


POLITICAL  ECONOMY 


tion.  What  ratio  can  there  be  between  a  quantity  and  a  desire, 
or  even  a  desire  combined  with  a  power?  A  ratio  between  de¬ 
mand  and  supply  is  only  intelligible  if  by  demand  we  mean  the 
quantity  demanded,  and  if  the  ratio  intended  is  that  between  the 
quantity  demanded  and  the  quantity  supplied.  But  again,  th^ 
quantity  demanded  is  not  a  fixed  quantity,  even  at  the  same  time 
and  place;  it  varies  according  to  the  value:  if  the  thing  i>  cheap, 
there  is  usually  a  demand  for  more  of  it  than  whqn  it  is  dear. 
The  demand,  therefore,  partly  depends  on  the  value.  But  it  was 
before  laid  down  that  the  value  depends  on  the  demand.  From 
this  contradiction  how  shall  we  extricate  ourselves?  How  solve 
the  paradox,  of  two  things,  each  depending  upon  the  other? 

Though  the  solution  of  these  difficulties  is  obvious  enough, 
the  difficulties  themselves  are  not  fanciful;  and  I  bring  them 
forward  thus  prominently,  because  I  am  certain  that  they  ob¬ 
scurely  haunt  every  inquirer  into  the  subject  who  has  not  openly 
faced  and  distinctly  realized  them.  Undoubtedly  the  true  solu¬ 
tion  must  have  been  frequently  given,  though  I  cannot  call  to 
mind  anyone  who  had  given  it  before  myself,  except  the  emi¬ 
nently  clear  thinker  and  skilful  expositor,  J.  B.  Say.  I  should 
have  imagined,  however,  that  it  must  be  familiar  to  all  political 
economists,  if  the  writings  of  several  did  not  give  evidence  of 
some  want  of  clearness  on  the  point,  and  if  the  instance  of  Mr. 
De  Quincey  did  not  prove  that  the  complete  non-recognition 
and  implied  denial  of  it  are  compatible  with  great  intellectual  in¬ 
genuity,  and  close  intimacy  with  the  subject  matter. 

’  §  4.  Meaning,  by  the  word  demand,  the  quantity  dpTTLar>^^, 
and  remembering  that  this  is  not  a  fixed  quantity,  but  in  gen¬ 
eral  varies  according  to  the  value,  let  us  suppose  that  the  de¬ 
mand  at  some  particular  time  exceeds  the  supply,  that  is,  there" 
are  persons  ready  to  buy,  at  the  market  value,  a  greater  quantity 
than  is  offered  for  sale.  ^Competition  takes  place  on  the  side  of 
the  buyers,  and  the  value  rises:  but  how  much?  In  the  ratio 
^omi^ay^suppose)  ^!  the  deficiency :  if  the  demand  exceeds 
the  supply  by  one-third,  the  value  rises  one-third.  By  no  means: 
for  when  the  value  has  risen  one-third,  the  demand  may  still 
exceed  the  supply;  there  may,  even  at  that  higher  value,  be  a 
greater  quantity  wanted  than  is  to  be  had;  and  the  competition 
of  buyers  may  still  continue.  If  the  article  is  a  necessary  of  life, 
which,  rather  than  resign,  people  are  willing  to  pay  for  at  any 
price,  a  deficiency  of  one-third  may  raise  the  price  to  double, 


DEMAND  AND  SUPPLY 


431 


triple,  or  quadruple.*  Or,  on  the  contrary,  the  competition  may 
cease  before  the  value  has  risen  in  even  the  proportion  of  the 
deficiency.  A  rise,  short  of  one-third,  may  place  the  article  be¬ 
yond  the  means  or  beyond  the  inclinations,  of  purchasers  to  the 
full  amount.  At  what  point,  then,  will  the  rise  be  arrested?  fcAt 
the  point,  whatever  it  be,  which  equalizes  the  demand  and  the 
supply:  at  the  price  which  cuts  off  the  extra  third  from  the  de- 
mandor  brings  forward  additional  sellers  sufficient  to  supply  it. 
When,  in  either  of  these  ways,  or  by  a  combination  of  both,  the 
demand  becomes  equal  and  no  more  than  equal  to  the  supply, 
the  rise  of  value  will  stop. 

The  converse  case  is  equally  simple.  Instead  of  a  demand 
beyond  the  supply,  let  us  suppose  a  supply  exceeding  the  de¬ 
mand.  The  competition  will  now  be  on  the  side  of  the  sellers: 
the  extra  quantity  can  only  find  a  market  by  calling  forth  an 
additional  demand  equal  to  itself.  This  is  accomplished  by 
means  of  cheapness;  the  value  falls,  and  brings  the  article  within 
the  reach  of  more  numerous  customers,  or  induces  those  who 

were  already  consumers  to  make  increased  purchases^  The  fall 

of  value  required  to  re-establish  equality,  is  different  in  different 
cases.  The  kinds  of  things  in  which  it  is  commonly  greatest  are 
at  the  two  extremities  of  the  scale;  absolute  necessaries,  or  those 
peculiar  luxuries,  the  taste  for  which  is  confined  to  a  small  class. 
In  the  case  of  food,  as  those  who  have  already  enough  do  not 
require  more  on  account  of  its  cheapness,  but  rather  expend  in 
other  things  what  they  save  in  food,  the  increased  consumption 
occasioned  by  cheapness,  carries  off,  as  experience  shows,  only 
a  small  part  of  the  extra  supply  caused  by  an  abundant  harvest  ;f 
and  the  fall  is  practically  arrested  only  when  the  farmers  with¬ 
draw  their  corn,  and  hold  it  back  in  hopes  of  a  higher  price; 
or  by  the  operations  of  speculators  who  buy  corn  when  it  is 
cheap,  and  store  it  up  to  be  brought  out  when  more  urgently 
wanted.  Whether  the  demand  and  supply  are  equalized  by  an 
increased  demand,  the  result  of  cheapness,  or  by  withdrawing 
a  part  of  the  supply,  equalized  they  are  in  either  case. 

Thus  we  see  that  the  idea  of  a  ratio,  as  between  demand  and 

*  “  The  price  of  corn  in  this  country  the  crops  amounting  to  one-third,  with- 
has  risen  from  100  to  200  per  cent,  and  out  any  surplus  from  a  former  year,  and 
upwards,  when  the  utmost  computed  de-  without  any  chance  of  relief  by  importa- 
ficiency  of  the  crops  has  not  been  more  tion,  the  price  might  rise  five,  six,  or 
than  between  one-sixth  and  one-third  even  tenfold.” — Tooke’s  “  History  of 
below  an  average,  and  when  that  defi-  Prices,”  vol.  i.  pp.  13 — 5. 
ciency  has  been  relieved  by  foreign  sup-  f  See  Tooke,  and  the  Report  of  the 
plies*  if  there  should  be  a  deficiency  of  Agricultural  Committee  of  1821. 


432 


POLITICAL  ECONOMY 


supply,  is  out  of  place,  and  has  no  concern  in  the  matter:  the 
proper  mathematical  analogy  is  that  of  an  equation.  ^De¬ 
mand  and  supply,  the  quantity  demanded  and  the  quantity  sup¬ 
plied.  will  be  made  equal.  _lf  unequal  at  anv  moment,  competi- 
tion  equalizes  them,  and  the  manner  in  which  this  is  done  is  bv 
fln  adjustment  of  the  value.  Jf  the  demand  increases,  the  value 
rises;  if  the  demand  diminishes,  the  value  falls:  again,  if  the 
supply  jails  off,  the  value  rises;  and  falls,  if  the  supply  is  in¬ 
creased.  The  rise  or  the  fall  continues  until  the  demand  and 
supply  are  again  equal  to  one  another:  and  the  value  which  a 
commodity  will  bring  in  any  market,  is  no  other  than  the  value 
which,  in  that  market,  gives  a  demand  just  sufficient  to  carry 
off  the  existing  or  expected  supply. 

This,  then,  is  the  Law  of  Value,  with  respect  to  all  commodi¬ 
ties  not  susceptible  of  being  multiplied  at  pleasure.  Such  com¬ 
modities,  no  doubt,  are  exceptions.  1  Here  is  another  law  for 
that  much  larger  class  of  things,  which  admit  of  indefinite  multi¬ 
plication.  But  it  is  not  the  less  necessary  to  conceive  distinctly 
and  grasp  firmly  the  theory  of  this  exceptional  case.  In  the 
first  place,  it  will  be  found  to  be  of  great  assistance  in  rendering 
the  more  common  case  intelligible.  And  in  the  next  place,  the 
principle  of  the  exception  stretches  wider,  and  embraces  more 
cases,  than  might  at  first  be  supposed. 

§  5.  There  are  but  few  commodities  which  are  naturally  and 
necessarily  limited  in  supply,  ^ut  any  commodity  whatever 
may  be  artificially  so.  Any  commodity  may  be  the  subject  of  a 
monopoly :  like  _tea,  in  this  country,  up  to  1834;  tobacco  in 
France,  opium  in  British  India,  at  present.  The  price  of  a 
monopolized  commodity  is  commonly  supposed  to  be  arbitrary; 
depending  on  the  will  of  the  monopolist,  and  limited  only  (as  in 
Mr.  De  Quincey’s  case  of  the  musical  box  in  the  wilds  of  Amer¬ 
ica)  by  the  buyer’s  extreme  estimate  of  its  worth  to  himself.  This 
is  in  one  sense  true,  but  forms  no  exception,  nevertheless,  to  the 
dependence  of  the  value  on  supply  and  demand.  The  monop¬ 
olist  can  fix  the  value  as  high  as  he  pleases,  short  of  wKat  the 
consumer  either  could  not  or  would  not  pay;  but  he  can  only 
do  so  by  limiting  the  supply.  The  Dutch  East  India  Company 
obtained  a  monopoly  jTrT(fe tor  the  produce  of  the  Spice  Islands, 
but  to  do  so  they  were  obliged,  in  good  seasons,  to  destroy  a 
portion  of  the  crop.  Had  they  persisted  in  selling  all  that  they 
produced,  they  must  have  forced  a  market  by  reducing  the 


DEMAND  AND  SUPPLY 


433 


price,  so  low,  perhaps,  that  they  would  have  received  for  the 
larger  quantity  a  less  total  return  than  for  the  smaller:  at  least 
they  showed  that  such  was  their  opinion  by  destroying  the  sur¬ 
plus.  Even  on  Lake  Superior,  Mr.  De  Quincey’s  huckster  could 
not  have  sold  his  box  for  sixty  guineas,  if  he  had  possessed  two 
musical  boxes  and  desired  to  sell  them  both.  Supposing  the 
cost  price  of  each  to  be  six  guineas,  he  would  have  taken  seventy 
for  the  two  in  preference  to  sixty  for  one;  that  is,  although  his 
monopoly  was  the  closest  possible,  he  would  have  sold  the  boxes 
at  thirty-five  guineas  each,  notwithstanding  that  sixty  was  not 
beyond  the  buyer’s  estimate  of  the  article  for  his  purposes. 
Monopoly  value,  therefore,  does  not  depend  on  any  peculiar 
principle,  but  is  a  mere  variety  of  the  ordinary  case  of  demand 
and  supply. 

Again,  though  there  are  few  commodities  which  are  at  all 
times  and  forever  unsusceptible  of  increase  of  supply,  any  com¬ 
modity  whatever  may  be  temporarily  so;  and  with  some  com¬ 
modities  this  is  habitually  the  case.  Agricultural  produce,  for 
example,  cannot  be  increased  in  quantity  before  the  next  har¬ 
vest;  the  quantity  of  corn  already  existing  in  the  world,  is  all 
that  can  be  had  for  sometimes  a  year  to  come.  During  that  in¬ 
terval,  corn  is  practically  assimilated  to  things  of  which  the 
quantity  cannot  be  increased.  In  the  case  of  most  commodities, 
it  requires  a  certain  time  to  increase  their  quantity;  ^nd  if  the 
demand  increases,  then  until  a  corresponding  supply  can  be 
brought  forward,  that  is,  until  the  supply  can  accommodate  it¬ 
self  to  the  demand,  the  value  will  so  rise  as  to  accommodate  the 
demand  to  the  supply. 

There  is  another  case,  the  exact  converse  of  this.  There 
are  some  articles  of  which  the  supply  may  be  indefinitely 
increased,  but  cannot  be  rapidly  diminished.  There  are 
things  so  durable  that  the  quantity  in  existence  is  at  all 
times  very  great  in  comparison  with  the  annual  prod¬ 
uce.  Gold,  and  the  more  durable  metals,  are  things  of  this 
sort;  and  also  houses.  The  supply  of  such  things  might  be  at 
once  diminished  by  destroying  them;  but  to  do  this  could  only 
be  the  interest  of  the  possessor  if  he  had  a  monopoly  of  the 
article,  and  could  repay  himself  for  the  destruction  of  a  part  by 
the  increased  value  of  the  remainder.  The  value,  therefore,  of 
such  things  may  continue  for  a  long  time  so  low,  either  from 
excess  of  supply  or  falling  off  in  the  demand,  as  to  put  a  com- 
VOL.  I. — 28 


434 


POLITICAL  ECONOMY 


plete  stop  to  further  production:  the  diminution  of  supply  by 
wearing  out  being  so  slow  a  process,  that  a  long  time  is  req¬ 
uisite,  even  under  a  total  suspension  of  production,  to  restore 
the  original  value.  During  that  interval  the  value  will  be  regu¬ 
lated  solely  by  supply  and  demand,  and  will  rise  very  gradually 
as  the  existing  stock  wears  out,  until  there  is  again  a  remunerat¬ 
ing  value,  and  production  resumes  its  course. 

Finally,  there  are  commodities  of  which,  though  capable  of 
being  increased  or  diminished  to  a  great,  and  even  an  unlimited 
extent,  the  value  never  depends  upon  anything  but  demand  and 
supply.  This  is  the  case,  in  particular,  with  the  commodity 
Labor:  of  the  value  of  which  we  have  treated  copiously  in  the 
preceding  Book:  and  there  are  many  cases  besides,  in  which 
we  shall  find  it  necessary  to  call  in  this  principle  to  solve  diffi¬ 
cult  questions  of  exchange  value.  This  will  be  particularly  ex¬ 
emplified  when  we  treat  of  International  Values;  that  is,  of  the 
terms  of  interchange  between  things  produced  in  different  coun¬ 
tries,  or,  to  speak  more  generally,  in  distant  places.  But  into 
these  questions  we  cannot  enter  until  we  shall  have  examined 
the  case  of  commodities  which  can  be  increased  in  quantity  in¬ 
definitely  and  at  pleasure;  and  shall  have  .determined  by  what 
■  law  other  than  that  oi  Demand  and  Supply  the  permanent  or 
average  Values  of  such  commodities_are_ regulated.  This  we 
shall  do  in  the  next  chapter. 

Chapter  III. — Of  Cost  of  Production,  in  its  Relation  to  Value 

§  I.  When  the  production  of  a  commodity  is  the  effect  of 
labor  and  expenditure,  whether  the  commodity  is  susceptible  of 
unlimited  multiplication  or  not,  there  is  a  minimum  value  which 
js  the  essential  condition  of  its  Eeing~~permanently  produced. 
The  value  at  any  particular  time  is  the  result  of  supply  and  de¬ 
mand  ;  and  is  always  that  which  is  necessary  to  create  a  market 
for  the  existing  supply.  But  unless  that  value  is  sufficient  to 
repay  the  Cost  ojLProduction.  and  to  afford,  besides,  the  ordi- 
nary  expectation  of  profitT  the  commodity  will  not  continue  to 
oe  produced.  Capitalists  will  not  go  on  permanently  producing 
at  a  loss.  They  will  not  even  on  producing  at  a  profit  less* 
than  they  can  live  upon.  Persons  whose  capitaTTs  already  em¬ 
barked,  and  cannot  be  easily  extricated,  will  persevere  for  a  con¬ 
siderable  time  without  profit,  and  have  been  known  to  persevere 


COST  OF  PRODUCTION 


435 


even  at  a  lqss,  in  hope  of  better  time£.  But  they  will  not  do  so 
indefinitely,  or  when  there  is  nothing  to  indicate  that  times  are 
likely  to  improve.  No  new  capital  will  be  invested  in  an  em¬ 
ployment,  unless  there  be  an  expectation  not  only  of  some  profit, 
but  of  a  profit  as  great  (regard  being  had  to  the  degree  of  eligi¬ 
bility  of  the  employment  in  other  respects,  as  can  be  hoped  for 
in  any  other  occupation  at  that  time  and  place.  When  such 
profit  is  evidently  not  to  be  had,  if  people  do  not  actually  with¬ 
draw  their  capital,  they  at  least  abstain  from  replacing  it  when 
consumed.  The  cost  of  production,  together  with  the  ordinary 
jrofit.  may,  therefore  be  called  the  necessary  price  or  value,  of 
all  things  made  bv  labor  and  capital.  Nobody  willingly  produces 
in  the  prospect  of  loss.  Whoever  does  so,  does  it  under  a  mis¬ 
calculation,  which  he  corrects  as  fast  as  he  is  able. 

When  a  commodity  is  not  only  made  by  labor  and  capital, 

but  can  be  made  by  them  in  indefinite  quantitvr  this  Necessary 
Valuer  the  minimum  with  which  the  producers  will  be  content, 
is  also,  if  competition  is  free  and  active,  the  maximum  which 
they  can  expect.  If  the  value  of  a  commodity  is  such  that  it  re¬ 
pays  the  cost  of  production  not  only  with  the  customary,  but 
with  a  higher  rate  of  profit,  capital  rushes  to  share  in  this  extra 
gain,  and  by  increasing  the  supply  of  the  article,  reduces 
value.  This  is  not  a  mere  supposition  or  surmise,  Bht  a  fact 
familiar  to  those  conversant  with  commerciaVjDperatifJS 
Whenever  a  new  line  of  business  presents  itself,  offering  a  hope 
of  unusual  profits,  and  whenever  any  established  trade  or  manu¬ 
facture  is  believed  to  be  yielding  a  greater  profit  than  customary, 
there  is  sure  to  be  in  a  short  time  so  large  a  production  or  im¬ 
portation  of  the  commodity,  as  not  only  destroys  the  extra  profit, 
but  generally  goes  beyond  the  mark,  and  sinks  the  value  as 
much  too  low  as  it  had  before  been  raised  too  high;  until  the 
over-supply  is  corrected  by  a  total  or  partial  suspension  of  fur¬ 
ther  production.  As  already  intimated,  these  variations  in  the 
quantity  produced  do  not  presuppose  or  require  that  any  person 
should  change  his  employment.  Those  whose  business  is  thriv¬ 
ing,  increase  their  produce  by  availing  themselves  more  largely 
of  their  credit,  while  those  who  are  not  making  the  ordinary 
profit,  restrict  their  operations,  and  (in  manufacturing  phrase) 
work  short  time.  In  this  mode  is  surely  and  speedily  effected 
the  equalization,  not  of  profits  perhaps,  but  of  the  expectations 
of  profit,  in  different  occupations. 


436 


POLITICAL  ECONOMY 


As  a  general  rule,  then>Tthings  tend  to  exchange  for  one  an¬ 
other  at  such  values  as  will  enable  each  producer  to  be  repaid 
the  cost  of  production  with  the  ordinary  profit;  in  other  words, 
such. as  will  give  to  all  producers  the  same  rate  of  profit  on  their 
putlav.  But  in  order  that  the  profit  may  be  equal  where  the 
outlay,  that  is,  the  cost  of  production,  is  equal,  things  must  or 
the  average  exchange  for  one  another  in  the  ratio  of  their  cost 
of  production;  things  of  which  the  cost  of  production  is  the 
same,  must  be  of  the  same  value.  For  only  thus  will  an  equal 
outlay  yield  an  equal  return.  If  a  farmer  with  a  capital  equal  to 
1,000  quarters  of  corn,  can  produce  1,200  quarters,  yielding  him 
a  profit  of  twenty  per  cent.;  whatever  else  can  be  produced  in 
the  same  time  by  a  capital  of  1,000  quarters,  must  be  worth,  that 
is,  must  exchange  for,  1,200  quarters,  otherwise  the  producer 
would  gain  either  more  or  less  than  twenty  per  cent. 

Adam  Smith  and  Ricardo  have  called  that  value  of  a  thing 
which  is  proportional  to  its  cost  of  production,  its  Natural  Vfllu£ 
(or  its  Natural  Price).  They  meant  by  this,  the  point  about 
wlnclilFeTalue  oscillates,  and  to  which  it  always  tends  to  return; 
the  centre  value,  towards  which,  as  Adam  Smith  expresses  it, 
the  market  jj&lug  of  a  thing  is  constantly  gravitating;  and  any 
wiation  from  which  is  but  a  temporary  irregularity,  which,  the 
moment  it  &dsts,  sets  forces  in  motion  tending  to  correct  it. 

average  of  years  sufficient  to  enable  the  oscillations  on 
one  side  of  the  central  line  to  be  compensated  by  those  on  the 
other,  the  market  value  agrees  with  the  natural  value;  but  it 
very  seldom  coincides  exactly  with  it  at  any  particular  time. 
The  sea  everywhere  tends  to  q  leyel:  but  is  at  an  e^act 

level;  its  surface  is  always  ruffled  by  waves,  and  often  agisted 
by  storms.  It  is  enough  that  no  point,  at  least  in  the  open  sea, 
is  permanently  higher  than  another.  Each  place  is  alternately 
elevated  and  depressed;  but  the  ocean  preserves  its  level.^ 

§  2.  The  latent  influence  by  which  the  values  of  things  are 
made  to  conform  in  the  long  run  to  the  cost  of  production,  is 
the  variation  that  would  otherwise  take  place  in  the  supply  of 
the  commodity.  The  supply  would  be  increased  if  the  thing 
continued  to  sell  above  the  ratio  of  its  cost  of  production,  and 
would  be  diminished  if  it  fell  below  that  ratio.  But  we  must  not 
therefore  suppose  it  to  be  necessary  that  the  supply  should  act¬ 
ually  be  either  diminished  or  increased.  Suppose  that  the  cost 
of  production  of  a  thing  is  cheapened  by  some  mechanical  in- 


COST  OF  PRODUCTION 


437 


vention,  or  increased  by  a  tax.  The  value  of  a  thing  would  in  a 
little  time,  if  not  immediately,  fall  in  the  one  case,  and  rise  in 
the  other;  and  it  would  do  so,  because  if  it  did  not,  the  supply 
would  in  the  one  case  be  increased,  until  the  price  fell,  in  the  other 
diminished,  until  it  rose.  For  this  reason,  and  from  the  erro¬ 
neous  notion  that  value  depends  on  the  proportion  between 
the  demand  and  the  supply,  many  persons  suppose  that  this  pro¬ 
portion  must  be  altered  whenever  there  is  any  change  in  the 
value  of  the  commodity;  that  the  value  cannot  fall  through  a 
diminution  of  the  cost  of  production,  unless  the  supply  is  perma¬ 
nently  increased;  nor  rise,  unless  the  supply  is  permanently 
diminished.  But  this  is  not  the  fact:  there  is  no  need  that  there 
should  be  any  actual  alteration  of  supply;  and  when  there  is, 

the  alteration,  if  permanent,  is  not  the  cause  but  the  consequence 

'of  the  alteration  in  value.  If,  indeed,  the  supply  could  not  be 
increased,  no  diminution  in  the  cost  of  production  would  lower 
the  value :  but  there  is  by  no  means  any  necessity  that  it  should. 
The  mere  possibility  often  suffices;  the  dealers  are  aware  of  what 
would  happen,  and  their  mutual  competition  makes  them  an¬ 
ticipate  the  result  by  lowering  the  price.  Whether  there  will  be 
a  greater  permanent  supply  of  the  commodity,  after  its  produc¬ 
tion  has  been  cheapened,  depends  on  quite  another  question, 
namely,  on  whether  a  greater  quantity  is  wanted  at  the  reduced 
value.  Most  commonly  a  greater  quantity  is  wanted,  but  not 
necessarily.  “  A  man,”  says  Mr.  De  Quincey,*  “  buys  an  article 
of  instant  applicability  to  his  own  purposes  the  more  readily  and 
the  more  largely  as  it  happens  to  be  cheaper.  Silk  handkerchiefs 
having  fallen  to  half-price,  he  will  buy,  perhaps,  in  threefold 
quantity;  but  he  does  not  buy  more.steam  engines  because  the 
price  is  lowered.  His  demand  for  steam  engines  is  almost  al¬ 
ways  predetermined  by  the  circumstances  of  his  situation.  So 
far  as  he  considers  the  cost  at  all,  it  is  much  more  the  cost  of 
working  this  engine  than  the  cost  upon  its  purchase.  But  there 
are  many  articles  for  which  the  market  is  absolutely  and  merely 
limited  by  a  pre-existing  system,  to  which  those  articles  are  at¬ 
tached  as  subordinate  parts  or  members.  How  could  we  force 
the  dials  or  faces  of  timepieces  by  artificial  cheapness  to  sell 
more  plentifully  than  the^  inner  works  or  movements  of  such 
timepieces?  Could  the  sale  of  wine-vaults  be  increased  without 
increasing  the  sale  of  wine?  Or  the  tools  of  shipwrights  find  an 


*  “  Logic  of  Political  Economy,”  pp.  230 — 1. 


438 


POLITICAL  ECONOMY 


enlarged  market  whilst  shipbuilding  was  stationary?  .  .  . 

Offer  to  a  town  of  3,000  inhabitants  a  stock  of  hearses,  no  cheap¬ 
ness  will  tempt  that  town  into  buying  more  than  one.  Offer  a 
stock  of  yachts,  the  chief  cost  lies  in  manning,  victualling,  re¬ 
pairing:  no  diminution  upon  the  mere  price  to  a  purchaser  will 
tempt  into  the  market  any  man  whose  habits  and  propensities 
had  not  already  disposed  him  to  such  a  purchase.  So  of  pro¬ 
fessional  costume  for  bishops,  lawyers,  students  at  Oxford.” 
Nobody  doubts,  however,  that  the  price  and  value  of  all  these 
things  would  be  eventually  lowered  by  any  diminution  of  their 
cost  of  production;  and  lowered  through  the  apprehension  en¬ 
tertained  of  new  competitors,  and  an  increased  supply:  though 
the  great  hazard  to  which  a  new  competitor  would  expose  him¬ 
self,  in  an  article  not  susceptible  of  any  considerable  extension 
of  its  market,  would  enable  the  established  dealers  to  maintain 
their  original  prices  much  longer  than  they  could  do  in  an  arti¬ 
cle  offering  more  encouragement  to  competition. 

Again,  reverse  the  case,  and  suppose  the  cost  of  production 
increased,  as  for  example  by  laying  a  tax  on  the  commodity. 
The  value  would  rise;  and  that,  probably,  immediately.  Would 
the  supply  be  diminished?  Only  if  the  increase  of  value  dimin¬ 
ished  the  demand.  Whether  this  effect  followed,  would  soon 
appear,  and  if  it  did,  the  value  would  recede  somewhat,  from 
excess  of  supply,  until  the  production  was  reduced,  and  would 
then  rise  again.  There  are  many  articles  for  which  it  requires 
a  very  considerable  rise  of  price,  materially  to  reduce  the  de¬ 
mand;  in  particular,  articles  of  necessity,  such  as  the  habitual 
food  of  the  people:  in  England,  wheaten  bread:  of  which  there 
is  probably  almost  as  much  consumed,  at  the  present  cost  price, 
as  there  would  be  with  the  present  population  at  a  price  con¬ 
siderably  lower.  Yet  it  is  especially  in  such  things  that  dearness 
or  high  price  is  popularly  confounded  with  scarcity.  Food  may 
be  dear  from  scarcity,  as  after  a  bad  harvest;  but  the  dearness 
(for  example)  which  is  the  effect  of  taxation,  or  of  corn  laws, 
has  nothing  whatever  to  do  with  insufficient  supply :  such  causes 
do  not  much  diminish  the  quantity  of  food  in  a  country:  it  is 
other  things  rather  than  food  that  are  diminished  in  quantity  by 
them,  since,  those  who  pay  more  for  food  not  having  so  much  to 
expend  otherwise,  the  production  of  other  things  contracts  itself 
to  the  limits  of  a  smaller  demand. 

It  is,  therefore,  strictly  correct  to  say,  that  the  value  of  things 


COST  OF  PRODUCTION 


439 


which  can  be  increased  in  quantity  at  pleasure,  does  not  depend 
(except  accidentally,  and  during  the  time  necessary  for  produc¬ 
tion  to  adjust  itself,)  upon  demand  and  supply;  on  the  contrary, 
demand  and  supply  depend  upon  it.  There  is  a  demand  for  a  cer¬ 
tain  quantity  of  the  commodity  at  its  natural  or  cost  value,  and 
to  that  the  supply  in  the  long  run  endeavors  to  conform.  When 
at  any  time  it  fails  of  so  conforming,  it  is  either  from  miscalcula¬ 
tion,  or  from  a  change  in  some  of  the  elements  of  the  problem: 
either  in  the  natural  value,  that  is,  in  the  cost  of  pro¬ 
duction;  or  in  the  demand,  from  an  alteration  in  public 
taste  or  in  the  number  or  wealth  of  the  consumers.  These 
causes  of  disturbance  are  very  liable  to  occur,  and  when 
any  one  of  them  does  occur,  the  market  value  of  the  article  ceases 
to  agree  with  the  natural  value.  The  real  law  of  demand  and 
supply,  the  equation  between  them,  holds  good  in  all  cases:  if 
a  value  different  from  the  natural  value  be  necessary  to  make 
the  demand  equal  to  the  supply,  the  market  value  will  deviate 
from  the  natural  value;  but  only  for  a  time;  for  the  permanent 
tendency  of  supply  is  to  conform  itself  to  the  demand  which  is 
found  by  experience  to  exist  for  the  commodity  when  selling 
at  its  natural  value.  If  the  supply  is  either  more  or  less  than 
this,  it  is  so  accidentally,  and  affords  either  more  or  less  than 
the  ordinary  rate  of  profit;  which,  under  free  and  active  com¬ 
petition,  cannot  long  continue  to  be  the  case. 

To  recapitulate:  demand  and  supply  govern  the  value  of  all 
things  which  cannot  be  indefinitely  increased;  except  that  even 
for  them,  when  produced  by  industry,  there  is  a  minimum  value, 
determined  by  the  cost  of  production.  But  in  all  things  which 
admit  of  indefinite  multiplication,  demand  and  supply  only  de¬ 
termine  the  perturbations  of  value,  during  a  period  which  can¬ 
not  exceed  the  length  of  time  necessary  for  altering  the  supply. 
While  thus  ruling  the  oscillations  of  value,  they  themselves  obey 
a  superior  force,  which  makes  value  gravitate  towards  Cost  of 
Production,  and  which  would  settle  it  and  keep  it  there,  if  fresh 
disturbing  influences  were  not  continually  arising  to  make  it 
again  deviate.  To  pursue  the  same  strain  of  metaphor,  demand 
and  supply  always  rush  to  an  equilibrium,  but  the  condition  of 
stable  equilibrium  is  when  things  exchange  for  each  other  ac¬ 
cording  to  their  cost  of  production,  or,  in  the  expression  we  have 
used,  when  things  are  at  their  Natural  Value. 


44© 


POLITICAL  ECONOMY 


Chapter  IV. — Ultimate  Analysis  of  Cost  of  Production 

§  i.  The  component  elements  of  Cost  of  Production  have 
been  set  forth  in  the  First  Part  of  this  inquiry.  The  principal 
of  them,  and  so  much  the  principal  as  to  be  nearly  the  sole,  we 
found  to  be  Labor.  What  the  production  of  a  thing  costs  to  its 
producer,  or  its  series  of  producers,  is  the  labor  expended  in 
producing  it.  If  we  consider  as  the  producer  the  capitalist  who 
makes  the  advances,  the  word  Labor  may  be  replaced  by  the 
word  Wages:  what  the  produce  costs  to  him,  is  the  wages  which 
he  has  had  to  pay.  At  the  first  glance  indeed  this  seems  to  be 
only  a  part  of  his  outlay,  since  he  has  not  only  paid  wages  to 
laborers,  but  has  likewise  provided  them  with  tools,  materials, 
and  perhaps  buildings.  These  tools,  materials,  and  buildings, 
however,  were  produced  by  labor  and  capital;  and  their  value, 
like  that  of  the  article  to  the  production  of  which  they  are  sub¬ 
servient,  depends  on  cost  of  production,  which  again  is  resolv¬ 
able  into  labor.  The  cost  of  production  of  broadcloth  does  not 
wholly  consist  in  the  wages  of  weavers;  which  alone  are  di¬ 
rectly  paid  by  the  cloth  manufacturer.  It  consists  also  of  the 
wages  of  spinners  and  woolcombers,  and  it  may  be  added,  of 
shepherds,  all  of  which  the  clothier  has  paid  for  in  the  price  of 
yarn.  It  consists  too  of  the  wages  of  builders  and  brickmakers, 
which  he  has  reimbursed  in  the  contract  price  of  erecting  his 
factory.  It  partly  consists  of  the  wages  of  machine-makers,  iron- 
founders,  and  miners.  And  to  these  must  be  added  the  wages 
of  the  carriers  who  transported  any  of  the  means  and  appliances 
of  the  production  to  the  place  where  they  were  to  be  used,  and 
the  product  itself  to  the  place  where  it  is  to  be  sold. 

The  value  of  commodities,  therefore,  depends  principally  (we 
shall  presently  see  whether  it  depends  solely")  on  the  quantity 
of  labor  required  for  their  production ;  including  in  the  idea  of 
production,  that  of  conveyance  to  the  market.  “  In  estimating,” 
says  Ricardo,*  “  the  exchangeable  value  of'  stockings,  for  ex¬ 
ample,  we  shall  find  that  their  value,  comparatively  with  other 
things,  depends  on  the  total  quantity  of  labor  necessary  to 
manufacture  them  and  bring  them  to  market.  First,  there  is 
the  labor  necessary  to  cultivate  the  land  on  which  the  raw  cot¬ 
ton  is  grown;  secondly,  the  labor  of  conveying  the  cotton  to 

*  “  Principles  of  Political  Economy  and  Taxation,”  chap.  i.  sect.  3. 


ULTIMATE  ANALYSIS  OF  COST  OF  PRODUCTION  441 


the  country  where  the  stockings  are  to  be  manufactured,  which 
includes  a  portion  of  the  labor  bestowed  in  building  the  ship  in 
which  it  is  conveyed,  and  which  is  charged  in  the  freight  of  the 
goods;  thirdly,  the  labor  of  the  spinner  and  weaver;  fourthly, 
a  portion  of  the  labor  of  the  engineer,  smith,  and  carpenter, 
who  erected  the  buildings  and  machinery  by  the  help  of  which 
they  are  made;  fifthly,  the  labor  of  the  retail  dealer,  and  of 
many  others,  whom  it  is  unnecessary  further  to  particularize. 
The  aggregate  sum  of  these  various  kinds  of  labor,  determines 
the  quantity  of  other  things  for  which  these  stockings  will  ex¬ 
change,  while  the  same  consideration  of  the  various  quantities 
of  labor  which  have  been  bestowed  on  those  other  things,  will 
equally  govern  the  portion  of  them  which  will  be  given  for  the 
stockings. 

“  To  convince  ourselves  that  this  is  the  real  foundation  of 
exchangeable  value,  let  us  suppose  any  improvement  to  be  made 
in  the  means  of  abridging  labor  in  any  one  of  the  various  proc¬ 
esses  through  which  the  raw  cotton  must  pass  before  the  manu¬ 
factured  stockings  come  to  the  market  to  be  exchanged  for  other 
things ;  and  observe  the  effects  which  will  follow.  If  fewer  men 
were  required  to  cultivate  the  raw  cotton,  or  if  fewer  sailors 
were  employed  in  navigating,  or  shipwrights  in  constructing, 
the  ship  in  which  it  was  conveyed  to  us;  if  fewer  hands  were 
employed  in  raising  the  buildings  and  machinery,  or  if  these, 
when  raised,  were  rendered  more  efficient;  the  stockings  would 
inevitably  fall  in  value,  and  command  less  of  other  things.  They 
would  fall,  because  a  less  quantity  of  labor  was  necessary  to  their 
production,  and  would  therefore  exchange  for  a  smaller  quantity 
of  those  things  in  which  no  such  abridgment  of  labor  had  been 
made. 

“  Economy  in  the  use  of  labor  never  fails  to  reduce  the  relative 
value  of  a  commodity,  whether  the  saving  be  in  the  labor  neces¬ 
sary  to  the  manufacture  of  the  commodity  itself,  or  in  that  neces¬ 
sary  to  the  formation  of  the  capital,  by  the  aid  of  which  it  is 
produced.  In  either  case  the  price  of  stockings  would  fall, 
whether  there  were  fewer  men  employed  as  bleachers,  spinners, 
and  weavers,  persons  immediately  necessary  to  their  manufact¬ 
ure;  or  as  sailors,  carriers,  engineers,  and  smiths,  persons  more 
indirectly  concerned.  In  the  one  case,  the  whole  saving  of  labor 
would  fall  on  the  stockings,  because  that  portion  of  labor  was 
wholly  confined  to  the  stockings;  in  the  other,  a  portion  only 


442 


POLITICAL  ECONOMY 


would  fall  on  the  stockings,  the  remainder  being  applied  to  all 
those  other  commodities,  to  the  production  of  which  the  build¬ 
ings,  machinery,  and  carriage,  were  subservient.” 

§  2.  It  will  have  been  observed  that  Ricardo  expresses  him¬ 
self  as  if  the  quantity  of  labor  which  it  costs  to  produce  a  com¬ 
modity  and  bring  it  to  market,  were  the  only  thing  on  which 
its  value  depended.  But  since  the  cost  of  production  to  the 
capitalist  is  not  labor  but  wages,  and  since  wages  may  be  either 
greater  or  less,  the  quantity  of  labor  being  the  same;  it  would 
seem  that  the  value  of  the  product  cannot  be  determined  solely 
by  the  quantity  of  labor,  but  by  the  quantity  together  with  the 
remuneration;  and  that  values  must  partly  depend  on  wages. 

In  order  to  decide  this  point,  it  must  be  considered,  that  value 
is  a  relative  term;  that  the  value  of  a  commodity  is  not  a  name 
for  an  inherent  and  substantive  quality  of  the  thing  itself,  but 
means  the  quantity  of  other  things  which  can  be  obtained  in 
exchange  for  it.  The  value  of  one  thing,  must  always  be  under¬ 
stood  relatively  to  some  other  thing,  or  to  things  in  general. 
Now  the  relation  of  one  thing  to  another  cannot  be  altered  by 
any  cause  which  affects  them  both  alike.  A  rise  or  fall  of  general 
wages  is  a  fact  which  affects  all  commodities  in  the  same  man¬ 
ner,  and  therefore  affords  no  reason  why  they  should  exchange 
for  each  other  in  one  rather  than  in  another  proportion.  To 
suppose  that  high  wages  uiake  high  values,  is  to  suppose  that 
there  can  be  such  a  thing  as  general  high  values."  But  this  is  a 
"contradiction  in  terms :  the  high  value  of  some  things  is 
synonymous  with  the  low  value  of  others.  The  mistake  arises 
from  not  attending  to  values,  but  only  to  prices.  Though 
there  is  no  such  thing  as  a  general  rise  of  values,  there  is 
such  a  thing  as  a  general  rise  of  prices.  As  soon  as  we 
form  distinctly  the  idea  of  values,  we  see  that  high  or  low 
wages  can  have  nothing  to  do  with  them :  but  that  high 
wages  make  high  prices,  is  a  popular  and  wide-spread  opin¬ 
ion.  The  whole  amount  of  error  involved  in  this  proposition 
can  only  be  seen  thoroughly  when  we  come  to  the  theory  of 
money;  at  present  we  need  only  say  that  if  it  be  true,  there  can 
be  no  such  thing  as  a  real  rise  of  wages ;  for  if  wages  could  not 
rise  without  a  proportional  rise  of  the  price  of  everything,  they 
could  not,  for  any  substantial  purpose,  rise  at  all.  ^This  surelv_ 
is  a  sufficient  reductio  ad  absurdum]  and  shows  the  amazing 
folly  oT  the  "propositions  which  may  and  do  become^nd  long 


ULTIMATE  ANALYSIS  OF  COST  OF  PRODUCTION  443 


remain,  accredited  doctrines  of  popular  political  economy.  It 
must  be  remembered,  too,  that  general  high  prices,  even  sup¬ 
posing  them  to  exist,  can  be  of  no  use  to  a  producer  or  dealer, 
considered  as  such;  for  if  they  increase  his  money  returns,  they 
increase  in  the  same  degree  all  his  expenses.  There  is  no  mode 
in  which  capitalists  can  compensate  themselves  for  a  high  cost 
of  labor,  through  any  action  on  values  or  prices.  It  cannot  be 
prevented  from  taking  its  effect  in  low  profits.  If  the  laborers 
really  get  more,  that  is,  get  the  produce  of  more  labor,  a  smaller 
percentage  must  remain  for  profit.  From  this  Law  of  Distribu¬ 
tion,  resting  as  it  does  on  a  law  of  arithmetic,  there  is  no  escape. 
The  mechanism  of  Exchange  and  Price  may  hide  it  from  us, 
but  is  quite  powerless  to  alter  it. 

§  3.  Although,  however,  general  wages,  whether  high  or  low, 
do  not  affect  values,  yet  if  wages  are  higher  in  one  employment 
than  another,  or  if  they  rise  or  fall  permanently  in  one  employ- 
Without  doing  so  in  others,  these  inequalities  do  really 
operate  upon  values.  The  causes  which  make  wages  vary  from 
one  employment  to  another,  have  been  considered  in  a  former 
chapter.  #Whcn  the  wages  of  an  employment  permanently  ex¬ 
ceed  the  average  rate,  the  value  of  the  thing  produced  will,  in 
the  same  degree,  exceed  the  standard  determined  by  mere 
quantity  of  labor.  Things,  for  example,  which  are  made  by 
skilled  labor,  exchange  for  the  produce  of  a  much  greater  quan¬ 
tity  of  unskilled  labor;  for  no  reason  but  because  the  labor  is 
more  highly  paid.  If,  through  the  extension  of  education,  the 
laborers  competent  to  skilled  employments  were  so  increased 
in  number  as  to  diminish  the  difference  between  their  wages  and 
those  of  common  labor,  all  things  produced  by  labor  of  the  su¬ 
perior  kind  would  fall  in  value,  compared  with  things  produced 
by  common  labor,  and  these  might  be  said  therefore  to  rise  in 
value.  We  have  before  remarked  that  the  difficulty  of  passing 
from  one  class  of  employments  to  a  class  greatly  superior,  has 
hitherto  caused  the  wages  of  all  those  classes  of  laborers  who 
are  separated  from  one  another  by  any  very  marked  barrier, 
to  depend  more  than  might  be  supposed  upon  the  increase  of 
the  population  of  each  class,  considered  separately;  and  that  the 
inequalities  in  the  remuneration  of  labor  are  much  greater  than 
could  exist  if  the  competition  of  the  laboring  people  generally, 
could  be  brought  practically  to  bear  on  each  particular  employ¬ 
ment.  It  follows  from  this,  that  wages  in  different  employments, 


444 


POLITICAL  ECONOMY 


do  not  rise  or  fall  simultaneously,  but  are,  for  short  and  some¬ 
times  even  for  long  periods,  nearly  independent  of  one  another. 
All  such  disparities  evidently  alter  the  relative  cost  of  production 
of  different  commodities,  and  will  therefore  be  completely  rep¬ 
resented  in  their  natural  or  average  value. 

It  thus  appears  that  the  maxim  laid  down  by  some  of  the  best 
political  economists,  that  wages  do  not  enter  into  value,  is  ex¬ 
pressed  with  greater  latitude  than  the  truth  warrants,  or  than  ac¬ 
cords  with  their  own  meaning.  Wages  do  enter  into  value.  The 
relative  wages  of  the  labor  necessary  for  producing  different 
commodities,  affect  their  value  just  as  much  as  the  relative  quan¬ 
tities  of  labor.  It  is  true,  the  absolute  wages  paid  have  no  effect 
upon  values;  but  neither  has  the  absolute  quantity  of  labor.  If 
that  were  to  vary  simultaneously  and  equally  in  all  commodities, 
values  would  not  be  affected.  If,  for  instance,  the  general  ef¬ 
ficiency  of  all  labor  were  increased,  so  that  all  things  without 
exception  could  be  produced  in  the  same  quantity  as  before  witfi 
a  smaller  amount  of  labor,  no  trace  of  this  general  diminution  of 
cost  of  production  would  show  itself  in  the  values  of  commodi¬ 
ties.  Any  change  which  might  take  place  in  them  would  only 
represent  the  unequal  degrees  in  which  the  improvement  af¬ 
fected  different  things;  and  would  consist  in  cheapening  those 
in  which  the  saving  of  labor  had  been  the  greatest,  while  those  in 
which  there  had  been  some,  but  a  less  saving  of  labor,  would 
actually  rise  in  value.  In  strictness,  therefore,  wages  of  labor 
have  as  much  to  do  with  value  as  quantity  of  labor:  and  neither 
Ricardo  nor  any  one  else  has  denied  the  fact.  In  considering, 
however,  the  causes  of  variations  in  value,  quantity  of  labor  is 
the  thing  of  chief  importance;  for  when  that  varies,  it  is  generally 
in  one  or  a  few  commodities  at  a  time,  but  the  variations  of 
wages  (except  passing  fluctuations)  are  usually  general,  and  have 
no  considerable  effect  on  value. 

§  4.  Thus  far  of  labor,  or  wages,  as  an  element  in  cost  of  pro¬ 
duction.  But  in  our  analysis,  in  the  First  Book,  of  the  requisites 
of  production,  we  found  that  there  is  another  necessary  element 
in  it  besides  labor.  There  is  also  capital;  and  this  being  jFe  re¬ 
sult  of  abstinence,  the  produce,  or  its  value,  must  be  sufficient  to 
remunerate,  not  only  all  the  labor  required,  but  the  abstinence 
of  all  the  persons  by  whom  the  remuneration  of  the  different 
classes  of  laborers  was  advanced.  The  return  for  abstinence  is 
Profit.  And  profit,  we  have  also  seen,  is  not  exclusively  the  sur- 


ULTIMATE  ANALYSIS  OF  COST  OF  PRODUCTION  445 


plus  remaining  to  the  capitalist  after  he  has  been  compensated 
for  his  outlay,  but  forms,  in  most  cases,  no  unimportant  part  of 
the  outlay  itself.  The  flax-spinner,  part  of  whose  expenses  con¬ 
sists  of  the  purchase  of  flax  and  of  machinery,  has  had  to  pay, 
in  their  price,  not  only  the  wages  of  the  labor  by  which  the  flax 
was  grown  and  the  machinery  made,  but  the  profits  of  the 
grower,  the  flax-dresser,  the  miner,  the  iron-founder,  and  the 
machine-maker.  All  these  profits,  together  with  those  of  the 
spinner  himself,  were  again  advanced  by  the  weaver,  in  the  price 
of  his  material,  linen  yarn:  and  along  with  them  the  profits  of  a 
fresh  set  of  machine-makers,  and  of  the  miners  and  iron-work¬ 
ers  who  supplied  them  with  their  metallic  material.  All  these 
advances  form  part  of  the  cost  of  production  of  linen.  Profits, 
therefore,  as  well  as  wages,  enter  into  the  cost  of  production 
which  determines  the  value  of  the  produce. 

Value,  however,  being  purely  relative,  cannot  depend  upon 

absolute  profits,  no  more  than  upon  absolute jvages,  but  upon 
relative  profits  only.  High  general  profits  cannot,  any  more 
than  high  general  wages,  be  a  cause  of  high  values,  because  high 
general  values  are  an  absurdity  and  a  contradiction.  In  so  far 
as  profits  enter  into  the  cost  of  production  of  all  things,  they 
cannot  affect  the  value  of  any.  It  is  only  by  entering  in  a  greater 
degree  into  the  cost  of  production  of  some  things  than  of 
others,  that  they  can  have  any  influence  on  value. 

For  example,  we  have  seen  that  there  are  causes  which  neces¬ 
sitate  a  permanently  higher  rate  of  profit  in  certain  employments 
than  in  others.  The  must  be  a  compensation  for  superior  risk, 
trouble,  and  disagreeableness.  This  can  only  be  obtained  by 
selling  the  commodity  at  a  value  above  that  which  is  due  to  the 
quantity  of  labor  necessary  for  its  production.  If  gunpowder 
exchanged  for  other  things  in  no  higher  ratio  than  that  of  the 
labor  required  from  first  to  last  for  producing  it,  no  one  would 
set  up  a  powder-mill.  Butchers  are  certainly  a  more  prosperous 
class  than  bakers,  and  do  not  seem  to  be  exposed  to  greater  risks, 
since  it  is  not  remarked  that  they  are  oftener  bankrupts.  They 
seem,  therefore,  to  obtain  higher  profits,  which  can  only  arise 
from  the  more  limited  competition  caused  by  the  unpleasantness, 
and  to  a  certain  degree,  the  unpopularity  of  their  trade.  But 
this  higher  profit  implies  that  they  sell  their  commodity  at  a 
higher  value  than  that  due  to  their  labor  and  outlay.  All  in¬ 
equalities  of  profit  which  are  necessary  and  permanent,  are  rep¬ 
resented  in  the  relative  values  of  the  commodities. 


446 


POLITICAL  ECONOMY 


§  5.  Profits,  however,  may  enter  more  largely  into  the  con¬ 
ditions  of  production  of  one  commodity  than  of  another,  even 
though  there  be  no  difference  in  the  rate  of  profit  between  the 
two  employments.  The  one  commodity  may  be  called  upon  to 
yield  profit  during  a  longer  period  of  time  than  the  other.  The 
example  by  which  this  case  is  usually  illustrated  is  that  of  wine. 
Suppose  a  quantity  of  wine,  and  a  quantity  of  cloth,  made  by 
equal  amounts  ot  labor,  and  that  labor  paid  at  the  same  rate. 
The’cloth  does  not  improve  by  keeping;  thUwihe  Hoes.  Sup¬ 
pose  that,  to  attain  the  desired  quality,  the  wine  requires  to  be 
kept  five  years.  The  producer  or  dealer  will  not  keep  it,  unless 
at  the  end  of  five  years  he  can  sell  it  for  as  much  more  than  the 
cloth,  as  amounts  to  five  years’  profit,  accumulated  at  compound 
interest.  The  wine  and  the  cloth  were  made  by  the  same  origi¬ 
nal  outlay.  Here  then  is  a  case  in  which  the  natural  values,  rela¬ 
tively  to  one  another,  of  two  commodities,  do  not  conform  to 
their  cost  of  production  alone,  but  to  their  cost  of  production  plus 
something  else.  Unless,  indeed,  for  the  sake  of  generality  in  the 
expression,  we  include  the  profit  which  the  wine-merchant  fore¬ 
goes  during  the  five  years,  in  the  cost  of  production  of  the  wine: 
looking  upon  it  as  a  kind  of  additional  outlay,  over  and  above  his 
other  advances,  for  which  outlay  he  must  be  indemnified  at  last. 

All  commodities  made  by  machinery  are  assimilated,  at  least 
approximately,  to  the  wine  in  the  preceding  example.  In  com¬ 
parison  with  things  made  wholly  by  immediate  labor,  profits 
enter  more  largely  into  their  cost  of  production.  Suppose  two 
commodities,  A  and  B,  each  requiring  a  year  for  its  production, 
by  means  of  a  capital  which  we  will  on  this  occasion  denote  by 
money,  and  suppose  to  be  £1,000.  A  is  made  wholly  by  im¬ 
mediate  labor,  the  whole  £1,000  being  expended  directly  in 
wages.  B  is  made  by  means  of  labor  which  costs  £500  and  a 
machine  which  costs  £500,  and  the  machine  is  worn  out  by  one 
year’s  use.  The  two  commodities  will  be  exactly  of  the  same 
value;  which,  if  computed  in  money,  and  if  profits  are  twenty 
per  cent,  per  annum,  will  be  £1,200.  But  of  this  £1,200,  in  the 
case  of  A,  only  £200,  or  one-sixth,  is  profit:  while  in  the  case  of 
B  there  is  not  only  the  £200,  but  as  much  of  £500  (the  price  of  the 
machine)  as  consisted  of  the  profits  of  the  machine-maker; 
which,  if  we  suppose  the  machine  also  to  have  taken  a  year  for 
its  production,  is  again  one-sixth.  So  that  in  the  case  of  A  only 
one-sixth  of  the  entire  return  is  profit,  whilst  in  B  the  element 


ULTIMATE  ANALYSIS  OF  COST  OF  PRODUCTION  447 


of  profit  comprises  not  only  a  sixth  of  the  whole,  but  an  addi¬ 
tional  sixth  of  a  large  part. 

The  greater  the  proportion  of  the  whole  capital  which  consists 
of  machinery,  or  buildings,  or  material,  or  anything  else  which 
must  be  provided  before  the  immediate  labor  can  commence,  the 
more  largely  will  profits  enter  into  the  cost  of  production.  It  is 
equally  true,  though  not  so  obvious  at  first  sight,  that  greater 
durability  in  the  portion  of  capital  which  consists  of  machinery 
or  buildings,  has  precisely  the  same  effect  as  a  greater  amount 
of  it.  As  we  just  supposed  one  extreme  case,  of  a  machine  en¬ 
tirely  worn  out  by  a  year’s  use,  let  us  now  suppose  the  opposite 
and  still  more  extreme  case,  of  a  machine  which  lasts  forever, 
and  requires  no  repairs.  In  this  case,  which  is  as  well  suited  for 
the  purpose  of  illustration  as  if  it  were  a  possible  one,  it  will  be 
unnecessary  that  the  manufacturer  should  ever  be  repaid  the 
£500  which  he  gave  for  the  machine,  since  he  has  always  the 
machine  itself,  worth  £500;  but  he  must  be  paid,  as  before,  a 
profit  on  it.  The  commodity  B,  therefore,  which  in  the  case 
previously  supposed  was  sold  for  £1,200,  of  which  sum  £1,000 
was  to  replace  the  capital  and  £200  was  profit,  can  now  be 
sold  for  £700,  being  £500  to  replace  wages,  and  £200  profit  on  the 
entire  capital.  Profit,  therefore,  enters  into  the  value  of  B  in  the 
ratio  of  £200  out  of  £700,  being  two-sevenths  of  the  whole,  or 
284  per  cent.,  while  in  the  case  of  A,  as  before,  it  enters  only 
in  the  ratio  of  one-sixth,  or  i6f  per  cent.  The  case  is  of  course 
purely  ideal,  since  no  machinery  or  other  fixed  capital  lasts  for¬ 
ever;  but  the  more  durable  it  is,  the  nearer  it  approaches  to  this 
ideal  case,  and  the  more  largely  does  profit  enter  into  the  return. 
If,  for  instance,  a  machine  worth  £500  loses  one-fifth  of  its  value 
by  each  year’s  use,  £100  must  be  added  to  the  return  to  make 
up  this  loss,  and  the  price  of  the  commodity  will  be  £800.  Profit 
therefore  will  enter  into  it  in  the  ratio  of  £200  to  £800,  or  one- 
fourth,  which  is  still  a  much  higher  proportion  than  one-sixth, 
or  £200  in  £1,200,  as  in  case  A. 

From  the  unequal  proportion  in  which,  in  different  employ¬ 
ments,  profits  enter  into  the  advances  of  the  capitalist,  and  there¬ 
fore  into  the  returns  required  by  him,  two  consequences  follow 
in  regard  to  value.  One  is,  that  commodities  do  not  exchange 
in  the  ratio  simply  of  the  quantities  of  labor  required  to  produce 
them;  not  even  if  we  allow  for  the  unequal  rates  at  which 
different  kinds  of  labor  are  permanently  remunerated.  We  have 


448 


POLITICAL  ECONOMY 


already  illustrated  this  by  the  example  of  wine:  we  shall  now 
further  exemplify  it  by  the  case  of  commodities  made  by  ma¬ 
chinery.  Suppose,  as  before,  an  article  A,  made  by  a  thousand 
pounds’  worth  of  immediate  labor.  But  instead  of  B,  made  by 
£500  worth  of  immediate  labor  and  a  machine  worth  £500,  let  us 
suppose  C,  made  by  £500  worth  of  immediate  labor  with  the  aid 
of  a  machine  which  has  been  produced  by  another  £500  worth 
of  immediate  labor:  the  machine  requiring  a  year  for  making, 
and  worn  out  by  a  year’s  use;  profits  being  as  before  twenty  per 
cent.  A  and  C  are  made  by  equal  quantities  of  labor,  paid  at 
the  same  rate:  A  costs  £1,000  worth  of  direct  labor;  C,  only 
£500  worth,  which  however  is  made  up  to  £1,000  by  the  labor 
expended  in  the  construction  of  the  machine.  If  labor,  or  its 
remuneration,  were  the  sole  ingredient  of  cost  of  production, 
these  twro  things  would  exchange  for  one  another.  But  will  they 
do  so?  Certainly  not.  The  machine  having  been  made  in  a  year 
by  an  outlay  of  £500,  and  profits  being  twenty  per  cent.,  the 
natural  price  of  the  machine  is  £600:  making  an  additional  £100 
which  must  be  advanced,  over  and  above  his  other  expenses,  by 
the  manufacturer  of  C,  and  repaid  to  him  with  a  profit  of  twenty 
per  cent.  While,  therefore,  the  commodity  A  is  sold  for  £1,200, 
C  cannot  be  permanently  sold  for  less  than  £1,320. 

A  second  consequence  is,  that  every  rise  or  fall  of  general 
profits  will  have  an  effect  on  values.  Not  indeed  by  raising  or 
lowering  them  generally  (which,  as  we  have  so  often  said,  is  a 
contradiction  and  an  impossibility) :  but  by  altering  the  propor¬ 
tion  in  which  the  values  of  things  are  affected  by  the  unequal 
lengths  of  time  for  which  profit  is  due.  When  two  things,  though 
made  by  equal  labor,  are  of  unequal  value  because  the  one  is 
called  upon  to  yield  profit  for  a  greater  number  of  years  or 
months  than  the  other;  this  difference  of  value  will  be  greater 
when  profits  are  greater,  and  less  when  they  are  less.  The  wine 
which  has  to  yield  five  years’  profit  more  than  the  cloth,  will 
surpass  it  in  value  much  more  if  profits  are  forty  per  cent,  than 
if  they  are  only  twenty.  The  commodities  A  and  C,  which, 
though  made  by  equal  quantities  of  labor,  were  sold  for  £1,200 
and  £1,320,  a  difference  of  ten  per  cent.,  would,  if  profits  had 
been  only  half  as  much,  have  been  sold  for  £1,100  and  £1,155,  a 
difference  of  only  five  per  cent. 

It  follows  from  this,  that  even  a  general  rise  of  wages,  when 
it  involves  a  real  increase  in  the  cost  of  labor,  does  in  some  de- 


ULTIMATE  ANALYSIS  OF  COST  OF  PRODUCTION  449 


gree  influence  values.  It  does  not  affect  them  in  the  manner 
vulgarly  supposed,  by  raising  them  universally.  But  an  increase 
in  the  cost  of  labor,  lowers  profits ;  and  therefore  lowers  in  nat¬ 
ural  value  the  things  into  which  profits  enter  in  a  greater  pro¬ 
portion  than  the  average,  and  raises  those  into  which  they  enter 
in  a  less  proportion  than  the  average.  All  commodities  in  the 
production  of  which  machinery  bears  a  large  part,  especially  if 
the  machinery  is  very  durable,  are  lowered  in  their  relative  value 
when  profits  fall;  or,  what  is  equivalent,  other  things  are  raised 
in  value  relatively  to  them.  This  truth  is  sometimes  expressed 
in  a  phraseology  more  plausible  than  sound,  by  saying  that  a 
rise  of  wages  raises  the  value  of  things  made  by  labor,  in  com¬ 
parison  with  those  made  by  machinery.  But  things  made  by 
machinery,  just  as  much  as  any  other  things,  are  made  by  labor, 
namely  the  labor  which  made  the  machinery  itself:  the  only 
difference  being  that  profits  enter  somewhat  more  largely  into 
the  production  of  things  for  which  machinery  is  used,  though 
the  principal  item  of  the  outlay  is  still  labor.  It  is  better,  there¬ 
fore,  to  associate  the  effect  with  fall  of  profits  than  with  rise  of 
wages;  especially  as  this  last  expression  is  extremely  ambigu¬ 
ous,  suggesting  the  idea  of  an  increase  of  the  laborer’s  real  re¬ 
muneration,  rather  than  of  what  is  alone  to  the  purpose  here, 
namely  the  cost  of  labor  to  its  employer. 

§  6.  Besides  the  natural  and  necessary  elements  in  cost  of 
production — labor  and  profits — there  are  others  which  are  arti¬ 
ficial  and  casual,  as  fof  instance  a  tax^  The  tax  on  malt  is  as 
much  a  part  of  the  cost  of  production  of  that  article,  as  the  wages 
of  the  laborers.  The  expenses  which  the  law  imposes,  as  well  as 
those  which  the  nature  of  things  imposes,  must  be  reimbursed 
with  the  ordinary  profit  from  the  value  of  the  produce,  or  the 
things  will  not  continue  to  be  produced.  But  the  influence  of 
taxation  on  value  is  subject  to  the  same  conditions  as  the  influ¬ 
ence  of  wages  and  of  profits.  It  is  not  general  taxation,  but 
differential  taxation,  that  produces  the  effect.  If  all  productions 
were  taxed  so  as  to  take  an  equal  percentage  from  all  profits, 
relative  values  would  be  in  no  way  disturbed.  If  only  a  few 
commodities  were  taxed,  their  value  would  rise:  and  if  only  a 
few  were  left  untaxed,  their  value  would  fall.  If  half  were  taxed 
and  the  remainder  untaxed,  the  first  half  would  rise  and  the  last 
would  fall  relatively  to  each  other.  This  would  be  necessary  in 
order  to  equalize  the  expectation  of  profit  in  all  employments, 
Vol.  I. — 29 


45° 


POLITICAL  ECONOMY 


without  which  the  taxed  employments  would  ultimately,  if  not 
immediately,  be  abandoned.  But  general  taxation,  when  equally 
imposed,  and  not  disturbing  the  relations  of  different  produc¬ 
tions  to  one  another,  cannot  produce  any  effect  on  values. 

We  have  thus  far  supposed  that  all  the  means  and  appliances 
which  enter  into  the  cost  of  production  of  commodities,  are 
things  whose  own  value  depends  on  their  cost  of  production. 
Some  of  them,  however,  may  belong  to  the  class  of  things  which 
cannot  be  increased  ad  libitum  in  quantity,  and  which  therefore, 
if  the  demand  goes  beyond  a  certain  amount,  command  a  scarc¬ 
ity  value.  The  materials  of  many  of  the  ornamental  articles 
manufactured  in  Italy  are  the  substances  called  rosso,  giallo , 
and  verde  antico,  which,  whether  truly  or  falsely  I  know  not, 
are  asserted  to  be  solely  derived  from  the  destruction  of  ancient 
columns  and  other  ornamental  structures:  the  quarries  from 
which  the  stone  was  originally  cut  being  exhausted,  or  their 
locality  forgotten.*  A  material  of  such  a  nature,  if  in  much  de¬ 
mand,  must  be  at  a  scarcity  value;  and  this  value  enters  into 
the  cost  of  production,  and,  consequently  into  the  value,  of  the 
finished  article.  The  time  seems  to  be  approaching  when  the 
more  valuable  furs  will  come  under  the  influence  of  a  scarcity 
value  of  the  material.  Hitherto  the  diminishing  number  of  the 
animals  which  produce  them,  in  the  wildernesses  of  Siberia  and 
on  the  coasts  of  the  Esquimaux  Sea,  has  operated  on  the  value 
only  through  the  greater  labor  which  has  become  necessary  for 
securing  any  given  quantity  of  the  article ;  since,  without  doubt, 
by  employing  labor  enough,  it  might  still  be  obtained  in  much 
greater  abundance  for  some  time  longer. 

But  the  case  in  which  scarcity  value  chiefly  operates  in  add¬ 
ing  to  cost  of  production,  is  the  case  of  natural  agents.  These, 
when  unappropriated,  and  to  be  had  for  the  taking,  do  not  enter 
into  cost  of  production,  save  to  the  extent  of  the  labor  which 
may  be  necessary  to  fit  them  for  use.  Even  when  appropriated, 
they  do  not  (as  we  have  already  seen)  bear  a  value  from  the 
mere  fact  of  the  appropriation,  but  only  from  scarcity,  that  is, 
from  limitation  of  supply.  But  it  is  equally  certain  that  they 
often  do  bear  a  scarcity  value.  Suppose  a  fall  of  water,  in  a 
place  where  there  are  more  mills  wanted  than  there  is  water¬ 
power  to  supply  them;  the  use  of  the  fall  of  water  will  have  a 

*  Some  of  these  quarries,  I  believe,  have  been  rediscovered,  and  are  again 
worked. 


RENT  IN  ITS  RELATION  TO  VALUE 


451 


scarcity  value,  sufficient  either  to  bring  tne  demand  down  to  the 
supply,  or  to  pay  for  the  creation  of  an  artificial  power,  by  steam 
or  otherwise,  equal  in  efficiency  to  the  water-power. 

A  natural  agent  being  a  possession  in  perpetuity,  and  being 
only  serviceable  by  the  products  resulting  from  its  continued 
employment,  the  ordinary  mode  of  deriving  benefit  from  its 
ownership  is  by  an  annual  equivalent,  paid  by  the  person  who 
uses  it,  from  the  proceeds  of  its  use.  This  equivalent  always 
might  be,  and  generally  is,  termed  rent.  The  question  therefore, 
respecting  the  influence  which  the  appropriation  of  natural 
agents  produces  on  values,  is  often  stated  in  this  form:  Does 
Rent  enter  into  Cost  of  Production?  and  the  answer  of  the  best 
political  economists  is  in  the  negative.  The  temptation  is  strong 
to  the  adoption  of  these  sweeping  expressions,  even  by  those 
who  are  aware  of  the  restrictions  with  which  they  must  be  taken; 
for  there  is  no  denying  that  they  stamp  a  general  principle  more 
firmly  on  the  mind,  than  if  it  were  hedged  round  in  theory  with 
all  its  practical  limitations.  But  they  also  puzzle  and  mislead, 
and  create  an  impression  unfavorable  to  political  economy,  as  if 
it  disregarded  the  evidence  of  facts.  No  one  can  deny  that  rent 
sometimes  enters  into  cost  of  production.  If  I  buy  or  rent  a 
piece  of  ground,  and  build  a  cloth  manufactory  on  it,  the  ground- 
rent  forms  legitimately  a  part  of  my  expenses  of  production, 
which  must  be  repaid  by  the  product.  And  since  all  factories 
are  built  on  ground,  and  most  of  them  in  places  where  ground 
is  peculiarly  valuable,  the  rent  paid  for  it  must,  on  the  average, 
be  compensated  in  the  values  of  all  things  made  in  factories. 
In  what  sense  it  is  true  that  rent  does  not  enter  into  the  cost  of 
production  or  affect  the  value  of  agricultural  produce,  will  be 
shown  in  the  succeeding  chapter. 

Chapter  V. — Of  Rent,  in  its  Relation  to  Value 

§  i.  We  have  investigated  the  laws  which  determine  the  value 
of  two  classes  of  commodities:  the  small  class  which,  being 
limited  to  the  definite  quantity  have  their  value  entirely  deter¬ 
mined  by  demand  and  supply,  save  that  their  cost  of  production 
(if  they  have  any)  constitutes  a  minimum  below  which  they  can¬ 
not  permanently  fall;  and  the  large  class,  which  can  be  multi¬ 
plied  ad  libitum  by  labor  and  capital,  and  of  which  the  cost  of 
production  fixes  the  maximum  as  well  as  the  minimum  at  which 


452 


POLITICAL  ECONOMY 


they  can  permanently  exchange.  But  there  is  still  a  third  kind 
of  commodities  to  be  considered:  those  which  have,  not  one, 
but  several  costs  of  production ;  which  can  always  be  increased 
in  quantity  by  labor  and  capital,  but  not  by  the  same  amount  of 
labor  and  capital;  of  which  so  much  may  be  produced  at  a  given 
cost,  but  a  further  quantity  not  without  a  greater  cost.  These 
commodities  form  an  intermediate  class,  partaking  of  the  char¬ 
acter  of  both  the  others.  The  principal  of  them  is  agricultural 
produce.  We  have  already  made  abundant  reference  to  the 
fundamental  truth,  that  in  agriculture,  the  state  of  the  art  being 
given,  doubling  the  labor  does  not  double  the  produce;  that  if- 
an  increased  quantity  of  produce  is  required,  the  additional  sup¬ 
ply  is  obtained  at  a  greater  cost  than  the  first.  Where  a  hundred 
quarters  of  corn  are  all  that  is  at  present  required  from  the  lands 
of  a  given  village,  if  the  growth  of  population  made  it  necessary 
to  raise  a  hundred  more,  either  by  breaking  up  worse  land  now 
uncultivated,  or  by  a  more  elaborate  cultivation  of  the  land  al¬ 
ready  under  the  plough,  the  additional  hundred,  or  some  part 
of  them  at  least,  might  cost  double  or  treble  as  much  per  quarter 
as  the  former  supply. 

If  the  first  hundred  quarters  were  all  raised  at  the  same  ex¬ 
pense  (only  the  best  land  being  cultivated) :  and  if  that  expense 
would  be  remunerated  with  the  ordinary  profit  by  a  price  of  20s. 
the  quarter;  the  natural  price  of  wheat,  so  long  as  no  more  than 
that  quantity  was  required,  would  be  20s. ;  and  it  could  only  rise 
above,  or  fall  below  that  price,  from  vicissitudes  of  seasons,  or 
other  casual  variations  in  supply.  But  if  the  population  of  the 
district  advanced,  a  time  would  arrive  when  more  than  a  hun¬ 
dred  quarters  would  be  necessary  to  feed  it.  We  must  suppose 
that  there  is  no  access  to  any  foreign  supply.  By  the  hypothesis, 
no  more  than  a  hundred  quarters  can  be  produced  in  the  dis¬ 
trict,  unless  by  either  bringing  worse  land  into  cultivation,  or 
altering  the  system  of  culture  to  a  more  expensive  one.  Neither 
of  these  things  will  be  done  without  a  rise  in  price.  This  rise  of 
price  will  gradually  be  brought  about  by  the  increasing  demand. 
So  long  as  the  price  has  risen,  but  not  risen  enough  to  repay 
with  the  ordinary  profit  the  cost  of  producing  an  additional 
quantity,  the  increased  value  of  the  limited  supply  partakes  of 
the  nature  of  a  scarcity  value.  Suppose  that  it  will  not  answer  to 
cultivate  the  second  best  land,  or  land  of  the  second  degree  of 
remoteness,  for  a  less  return  than  25s.  the  quarter;  and  that  this 


RENT  IN  ITS  RELATION  TO  VALUE 


453 


price  is  also  necessary  to  remunerate  the  expensive  operations 
by  which  an  increase^  produce  might  be  raised  from  land  of  the 
first  quality.  If  so,  the  price  will  rise,  through  the  increased 
demand,  until  it  reaches  25s.  That  will  now  be  the  natural 
price;  being  the  price  without  which  the  quantity,  for  which 
society  has  a  demand  at  that  price,  will  not  be  produced.  At 
that  price,  however,  society  can  go  on  for  some  time  longer; 
could  go  on  perhaps  forever,  if  population  did  not  increase. 
The  price,  having  attained  that  point,  will  not  again  permanently 
recede  (though  it  may  fall  temporarily  from  accidental  abun¬ 
dance)  ;  nor  will  it  advance  further,  so  long  as  society  can  obtain 
the  supply  it  requires  without  a  second  increase  of  the  cost  of 
production. 

I  have  made  use  of  Price  in  this  reasoning,  as  a  convenient 
symbol  of  Value,  from  the  greater  familiarity  of  the  idea;  and  I 
shall  continue  to  do  so  as  far  as  may  appear  to  be  necessary. 

In  the  case  supposed,  different  portions  of  the  supply  of  corn 
have  different  costs  of  production.  Though  the  20,  or  50,  or  150 
quarters  additional  have  been  produced  at  a  cost  proportional  to 
25s.,  the  original  hundred  quarters  per  annum  are  still  produced 
at  a  cost  only  proportional  to  20s.  This  is  self-evident,  if  the 
original  and  the  additional  supply  are  produced  on  different 
qualities  of  land.  It  is  equally  true  if  they  are  produced  on  the 
same  land.  Suppose  that  land  of  the  best  quality,  which  pro¬ 
duced  100  quarters  at  20s.,  has  been  made  to  produce  150  by  an 
expensive  process,  which  it  would  not  answer  to  undertake  with¬ 
out  a  price  of  25s.  The  cost  which  requires  25s.  is  incurred  for 
the  sake  of  50  quarters  alone:  the  first  hundred  might  have  con¬ 
tinued  forever  to  be  produced  at  the  original  cost,  and  with  the 
benefit,  on  that  quantity,  of  the  whole  rise  of  price  caused  by  the 
increased  demand:  no  one,  therefore,  will  incur  the  additional 
expense  for  the  sake  of  the  additional  fifty,  unless  they  alone  will 
pay  for  the  whole  of  it.  The  fifty,  therefore,  will  be  produced  at 
their  natural  price,  proportioned  to  the  cost  of  their  production : 
while  the  other  hundred  will  now  bring  in  5s.  a  quarter  more 
than  their  natural  price — than  the  price  corresponding  to,  and 
sufficing  to  remunerate,  their  lower  cost  of  production. 

If  the  production  of  any,  even  the  smallest,  portion  of  the 
supply,  requires  as  a  necessary  condition  a  certain  price,  that 
price  will  be  obtained  for  all  the  rest.  We  are  not  able  to  buy 
one  loaf  cheaper  than  another  because  the  corn  from  which  it 


454 


POLITICAL  ECONOMY 


was  made,  being  grown  on  a  richer  soil,  has  cost  less  to  the 
grower.  The  value.  thereforer  of  an  article,  (meaning  its  natural, 
which  is  the  same  with  its  average  valueRis  determined  by  the 
cost  of  that  portion  of  the  supply  which  is  produced  andbrought 
to  market  at  the  greatest  expense.  This  is  the  Law  of  Value  of 
the  third  of  the  three  classes  into  which  all  commodities  are  di- 
vided. 

§  2.  If  the  portion  of  produce  raised  in  the  most  unfavorable 
circumstances,  obtains  a  value  proportioned  to  its  cost  of  pro- 
duction;  all  the  portions  raised  in  more  favorable  circumstances, 
selling  as"'they  must  do  a't  tile  same  value,  obtain  a  value  more 
than  proportioned  to  their  cost  of  production.  Their  value  is 
not,  correctly  speaking,  a  scarcity  value,  for  it  is  determined 
by  the  circumstances  of  the  production  of  the  commodity,  and 
not  by  the  degree  of  dearness  necessary  for  keeping  down  the 
demand  to  the  level  of  a  limited  supply.  The  owners,  however, 
of  those  portions  of  the  produce  enjoy  a  privilege;  they  obtain 
a  value  which  yields  them  more  than  the  ordinary  profit.  If  this 
advantage  depends  upon  any  special  exemption,  such  as  being 
free  from  a  tax,  or  upon  any  personal  advantages,  physical  or 
mental,  or  any  peculiar  process  only  known  to  themselves,  or 
upon  the  possession  of  a  greater  capital  than  other  people,  or 
upon  various  other  things  which  might  be  enumerated,  they  re¬ 
tain  it  to  themselves  as  an  extra  gain,  over  and  above  the  general 
profits  of  capital,  of  the  nature,  in  some  sort,  of  a  monopoly 
profit.  But  when,  as  in  the  case  which  we  are  more  particularly 
considering,  the  advantage  depends  on  the  possession  of  a  nat¬ 
ural  agent  of  peculiar  quality,  as,  for  instance,  of  more  fertile 
land  than  that  which  determines  the  general  value  of  the  com¬ 
modity;  and  when  this  natural  agent  is  not  owned  by  them¬ 
selves;  the  person  who  does  own  it,  is  able  to  exact  from  them, 
in  the  form  of  rent,  the  whole  extra  gain  derived  from  its  use. 
We  are  thus  brought  by  another  road  to  the  Law  of  Rent,  in¬ 
vestigated  in  the  concluding  chapter  of  the  Second  Book.  Rent, 
we  again  see,  is  the  difference  between  the  unequal  returns  to 
different  parts  of  the  capital  employed  on  the  soil. ,  Whatever 
surplus  any  portion  of  agricultural  capital  produces,  beyond 
what  is  produced  by  the  same  amount  of  capital  on  the  worst  soil, 
or  under  the  most  expensive  mode  of  cultivation,  which  the  ex¬ 
isting  demands  of  society  compel  a  recourse  to;  that  surplus 
will  naturally  be  paid  as  rent  from  that  capital,  to  the  owner  of 
the  land  on  which  it  is  employed. 


RENT  IN  ITS  RELATION  TO  VALUE 


455 


It  was  long  thought  by  political  economists,  among  the  rest 
even  by  Adam  Smith,  that  the  produce  of  land  is  always  at  a 
monopoly  value,  because  (they  said)  in  addition  to  the  ordinary 
rate  of  profit,  it  always  yields  something  further  for  rent.  This 
we  now  see  to  be  erroneous.  A  thing  cannot  be  at  a  monopoly 
value,  when  its  supply  can  be  increased  to  an  indefinite  extent 
if  we  are  only  willing  to  incur  the  cost.  If  no  more  corn  than 
the  existing  quantity  is  grown,  it  is  because  the  value  has  not 
risen  high  enough  to  remunerate  any  one  for  growing  it.  Any 
land  (not  reserved  for  other  uses,  or  for  pleasure)  which  at  the 
existing  price,  and  by  the  existing  processes,  will  yield  the  ordi¬ 
nary  profit,  is  tolerably  certain,  unless  some  artificial  hindrance 
intervenes,  to  be  cultivated,  although  nothing  may  be  left  for 
rent.  As  long  as  there  is  any  land  fit  for  cultivation,  which  at 
the  existing  price  cannot  be  profitably  cultivated  at  all,  there 
must  be  some  land  a  little  better,  which  will  yield  the  ordinary 
profit,  but  allow  nothing  for  rent:  and  that  land,  if  within  the 
boundary  of  a  farm,  will  be  cultivated  by  the  farmer;  if  not  so, 
probably  by  the  proprietor,  or  by  some  other  person  on  suffer¬ 
ance.  Some  such  land  at  least,  under  cultivation,  there  can 
scarcely  fail  to  be. 

Rent,  therefore,  forms  no  part  of  the  cost  of  production  which 
determines  the  value  of  agricultural  produce.  Circumstances  no 
doubt  may  be  conceived  in  which  it  might  do  so,  and  very  largely 
too.  We  can  imagine  a  country  so  fully  peopled,  and  with  all  its 
cultivable  soil  so  completely  occupied,  that  to  produce  any  addi¬ 
tional  quantity  would  require  more  labor  than  the  produce  would 
feed:  and  if  we  suppose  this  to  be  the  condition  of  the  whole 
world,  or  of  a  country  debarred  from  foreign  supply,  then,  if 
population  continued  increasing,  both  the  land  and  its  produce 
would  really  rise  to  a  monopoly  or  scarcity  pricq.  But  this  state 
of  things  never  can  liave  really  existed  anywhere,  unless  pos¬ 
sibly  in  some  small  island  cut  off  from  the  rest  of  the  world;  nor 
is  there  any  danger  whatever  that  it  should  exist.  It  certainly 
exists  in  no  known  region  at  present.  Monopoly,  we  have  seen, 
can  take  effect  on  value,  only  through  limitation  of  supply.  In 
all  countries  of  any  extent  there  is  more  cultivable  land  than  is 
yet  cultivated:  and  while  there  is  any  such  surplus,  it  is  the 
same  thing,  so  far  as  that  quality  of  land  is  concerned,  as  if  there 
were  an  indefinite  quantity.  What  is  practically  limited  in  supply 
is  only  the  better  qualities;  and  even  for  those,  so  much  rent 


456 


POLITICAL  ECONOMY 


cannot  be  demanded  as  would  bring  in  the  competition  of  the 
lands  not  yet  in  cultivation;  the  rent  of  a  piece  of  land  must  be 
somewhat  less  than  the  whole  excess  of  its  productiveness  over 
that  of  the  best  land  which  it  is  not  yet  profitable  to  cultivate; 
that  is,  it  must  be  about  equal  to  the  excess  above  the  worst  land 
which  it  is  profitable  to  cultivate.  The  land  or  the  capital  most 
unfavorably  circumstanced  among  those  actually  employed, 
pays  no  rent;  and  that  land  or  capital  determines  the  cost  of  pro¬ 
duction  which  regulates  the  value  of  the  whole  produce.  Thus 
rent  is,  as  we  have  already  seen,  no  cause  of  value,  but  the  price 
of  the  privilege  which  the  inequality  of  the  returns  to  different 
portions  of  agricultural  produce  confers  on  all  except  the  least 
favored  portion. 

Rent,  in  short,  merely  equalizes  the  profits  of  different  farm¬ 
ing  capitals,  by  enabling  the  landlord  to  appropriate  all  extra 
gains  occasioned  by  superiority  of  natural  advantages.  If  all 
landlords  were  unanimously  to  forego  their  rent,  they  would  but 
transfer  it  to  the  farmers,  without  benefiting  the  consumer;  for 
the  existing  price  of  corn  would  still  be  an  indispensable  con¬ 
dition  of  the  production  of  part  of  the  existing  supply,  and  if 
a  part  obtained  that  price  the  whole  would  obtain  it.  Rent, 
therefore,  unless  artificially  increased  by  restrictive  laws,  is  no 
burden  on  the  consumer;  it  does  not  raise  the  price  of  corn,  and 
is  no  otherwise  a  detriment  to  the  public,  than  inasmuch  as  if 
the  state  had  retained  it,  or  imposed  an  equivalent  in  the  shape 
of  a  land-tax,  it  would  then  have  been  a  fund  applicable  to  gen¬ 
eral  instead  of  private  advantage. 

§  3.  Agricultural  productions  are  not  the  only  commodities 
which  have  several  different  costs  of  production  at  once,  and 
which,  in  consequence  of  that  difference,  and  in  proportion  to  it, 
afford  a  rent.  Mines  are  also  an  instance.  Almost  all  kinds  of 
raw  material  extracted  from  the  interior'  of  the  earth — metals, 
coals,  precious  stones,  etc.,  are  obtained  from  mines  differing 
considerably  in  fertility,  that  is,  yielding  very  different  quantities 
of  the  product  to  the  same  quantity  of  labor  and  capital.  This 
being  the  case,  it  is  an  obvious  question,  why  are  not  the  most 
fertile  mines  so  worked  as  to  supply  the  whole  market?  No 
such  question  can  arise  as  to  land;  it  being  self-evident,  that  the 
most  fertile  lands  could  not  possibly  be  made  to  supply  the 
whole  demand  of  a  fully-peopled  country ;  and  even  of  what  they 
do  yield,  a  part  is  extorted  from  them  by  a  labor  and  outlay  as 


RENT  IN  ITS  RELATION  TO  VALUE 


457 


great  as  that  required  to  grow  the  same  amount  on  worse  land. 
But  it  is  not  so  with  mines;  at  least,  not  universally.  There  are, 
perhaps,  cases  in  which  it  is  impossible  to  extract  from  a  par¬ 
ticular  vein,  in  a  given  time,  more  than  a  certain  quantity  of  ore, 
because  there  is  only  a  limited  surface  of  the  vein  exposed,  on 
which  more  than  a  certain  number  of  laborers  cannot  be  simul¬ 
taneously  employed.  But  this  is  not  true  of  all  mines.  In  col¬ 
lieries,  for  example,  some  other  cause  of  limitation  must  be 
sought  for.  In  some  instances  the  owners  limit  the  quantity 
raised,  in  order  not  too  rapidly  to  exhaust  the  mine:  in  others 
there  are  said  to  be  combinations  of  owners,  to  keep  up  a  monop¬ 
oly  price  by  limiting  the  production.  Whatever  be  the  causes, 
it  is  a  fact  that  mines  of  different  degrees  of  richness  are  in  opera¬ 
tion,  and  since  the  value  of  the  produce  must  be  proportional  to 
the  cost  of  production  at  the  worst  mine  (fertility  and  situation 
taken  together),  it  is  more  than  proportional  to  that  of  the  best. 
All  mines  superior  in  produce  to  the  worst  actually  worked,  will 
yield,  therefore,  a  rent  equal  to  the  excess.  They  may  yield 
more;  and  the  worst  mine  may  itself  yield  a  rent.  Mines  being 
comparatively  few,  their  qualities  do  not  graduate  gently  into 
one  another,  as  the  qualities  of  land  do;  and  the  demand  may 
be  such  as  to  keep  the  value  of  the  produce  considerably  above 
the  cost  of  production  at  the  worst  mine  now  worked,  without 
being  sufficient  to  bring  into  operation  a  still  worse.  During 
the  interval,  the  produce  is  really  at  a  scarcity  value. 

Fisheries  are  another  example.  Fisheries  in  the  open  sea  are 
not  appropriated,  but  fisheries  in  lakes  or  rivers  almost  always 
are  so,  and  likewise  oyster-beds  or  other  particular  fishing- 
grounds  on  coasts.  We  may  take  salmon  fisheries  as  an  exam¬ 
ple  of  the  whole  class.  Some  rivers  are  far  more  productive  in 
salmon  than  others.  None,  however,  without  being  exhausted, 
can  supply  more  than  a  very  limited  demand.  The  demand  of  a 
country  like  England  can  only  be  supplied  by  taking  salmon 
from  many  different  rivers  of  unequal  productiveness,  and  the 
value  must  be  sufficient  to  repay  the  cost  of  obtaining  the  fish 
from  the  least  productive  of  these.  All  others,  therefore,  will  if 
appropriated  afford  a  rent  equal  to  the  value  of  their  superiority. 
Much  higher  than  this  it  cannot  be,  if  there  are  salmon  rivers  ac¬ 
cessible  which  from  distance  or  inferior  productiveness  have  not 
yet  contributed  to  supply  the  market.  If  there  are  not,  the  value, 
doubtless,  may  rise  to  a  scarcity  rate,  and  the  worst  fisheries  in 
use  may  then  yield  a  considerable  rent. 


458 


POLITICAL  ECONOMY 


Both  in  the  case  of  mines  and  of  fisheries,  the  natural  order  of 
events  is  liable  to  be  interrupted  by  the  opening  of  a  new  mine, 
or  a  new  fishery,  of  superior  quality  to  some  of  those  already  in 
use.  The  first  effect  of  such  an  incident  is  an  increase  of  the 
supply;  which  of  course  lowers  the  value  to  call  forth  an  in¬ 
creased  demand.  This  reduced  value  may  be  no  longer  suffi¬ 
cient  to  remunerate  the  worst  of  the  existing  mines  or  fisheries, 
and  these’ may  consequently  be  abandoned.  If  the  superior 
mines  or  fisheries,  with  the  addition  of  the  one  newly  opened, 
produce  as  much  of  the  commodity  as  is  required  at  the  lower 
value  corresponding  to  their  lower  cost  of  production,  the  fall 
of  value  will  be  permanent,  and  there  will  be  a  corresponding 
fall  in  the  rents  of  those  mines  or  fisheries  which  are  not  aban¬ 
doned.  In  this  case,  when  things  have  permanently  adjusted 
themselves,  the  result  will  be,  that  the  scale  of  qualities  which 
supply  the  market  will  have  been  cut  short  at  the  lower  end,  while 
a  new  insertion  will  have  been  made  in  the  scale  at  some  point 
higher  up ;  and  the  worst  mine  or  fishery  in  use — the  one  which 
regulates  the  rents  of  the  superior  qualities  and  the  value  of  the 
commodity — will  be  a  mine  or  fishery  of  better  quality  than  that 
by  which  they  were  previously  regulated. 

Land  is  used  for  other  purposes  than  agriculture,  especially  for 
residence;  and  when  so  used,  yields  a  rent,  determined  by  prin¬ 
ciples  similar  to  those  already  laid  down.  The  ground  rent  of  a 
building,  and  the  rent  of  a  garden  or  park  attached  to  it,  will 
not  be  less  than  the  rent  which  the  same  land  would  afford  in 
agriculture:  but  may  be  greater  than  this  to  an  indefinite 
amount:  the  surplus  being  either  in  consideration  of  beauty  or 
of  convenience,  the  convenience  often  consisting  in  superior  fa¬ 
cilities  for  pecuniary  gain.  Sites  of  remarkable  beauty  are  gen¬ 
erally  limited  in  supply,  and  therefore,  if  in  great  demand,  are 
at  a  scarcity  value.  Sites  superior  only  in  convenience,  are  gov¬ 
erned  as  to  their  value  by  the  ordinary  principles  of  rent.  The 
ground-rent  of  a  house  in  a  small  village  is  but  little  higher  than 
the  rent  of  a  similar  patch  of  ground  in  the  open  fields :  but  that 
of  a  shop  in  Cheapside  will  exceed  these,  by  the  whole  amount 
at  which  people  estimate  the  superior  facilities  of  money-mak¬ 
ing  in  the  more  crowded  place.  The  rents  of  wharfage,  dock 
and  harbor  room,  water-power,  and  many  other  privileges,  may 
be  analyzed  on  similar  principles. 

§  4-_  Cases  of  extra  profit  analogous  to  rent,  are  more  fre- 


RENT  IN  ITS  RELATION  TO  VALUE 


459 


tquent  in  the  transactions  of  industry  than  is  sometimes  s up  - 
posed.  Take  the  case,  for  example,  of  a  patent,  or  exclusive 
privilege  for  the  use  of  a  process  by  which  cost  of  production  is 
lessened.  If  the  value  of  the  product  continues  to  be  regulated 
by  what  it  costs  to  those  who  are  obliged  to  persist  in  the  old 
process,  the  patentee  will  make  an  extra  profit  equal  to  the  ad¬ 
vantage  which  his  process  possesses  other  theirs.  This  extra 
profit  is  essentially  similar  to  rent,  and  sometimes  even  assumes 
the  form  of  it;  the  patentee  allowing  to  other  producers  the  use 
of  his  privilege,  in  consideration  of  an  annual  payment.  So  long 
as  he,  and  those  whom  he  associates  in  the  privilege,  do  not 
produce  enough  to  supply  the  whole  market,  so  long  the  original 
cost  of  production,  being  the  necessary  condition  of  producing 
a  part,  will  regulate  the  value  of  the  whole;  and  the  patentee 
will  be  enabled  to  keep  up  his  rent  to  a  full  equivalent  for  the 
advantage  which  his  process  gives  him.  In  the  commencement 
indeed  he  will  probably  forego  a  part  of  this  advantage  for  the 
sake  of  underselling  others :  the  increased  supply  which  he  brings 
forward  will  lower  the  value,  and  make  the  trade  a  bad  one  for 
those  who  do  not  share  in  the  privilege:  many  of  whom  there¬ 
fore  will  gradually  retire,  or  restrict  their  operations,  or  enter 
into  arrangements  with  the  patentee.  As  his  supply  increases 
theirs  will  diminish,  the  value  meanwhile  continuing  slightly  de¬ 
pressed.  But  if  he  stops  short  in  his  operations  before  the  market 
is  wholly  supplied  by  the  new  process,  things  will  again  adjust 
themselves  to  what  was  the  natural  value  before  the  invention 
was  made,  and  the  benefit  of  the  improvement  will  accrue  solely 
to  the  patentee. 

The  extra  gains  which  any  producer  or  dealer  obtains 
through  superior  talents  for  business,  or  superior  business 
arrangements,  are  very  much  of  a  similar  kind..  If  all  his 
competitors  had  the  same  advantages,  and  used  them,  the 
benefit  would  be  transferred  to  their  customers,  through  the 
diminished  value  of  the  article:  he  only  retains  it  for  himself 
because  he  is  able  to  bring  his  commodity  to  market  at  a  lower 
cost,  while  its  value  is  determined  by  a  higher.  All  advantages, 
in  fact,  which  one  competitor  has  over  another,  whether  natural 
or  acquired,  whether  personal  or  the  result  of  social  arrange¬ 
ments,  bring  the  commodity,  so  far,  into  the  Third  Class,  and 
assimilate  the  possessor  of  the  advantage  to  a  receiver  of  rent. 
Wages  and  profits  represent  the  universal  elements  in  produc- 


460 


POLITICAL  ECONOMY 


tion,  while  rent  may  be  taken  to  represent  the  differential  and 

% 

peculiar:  any  difference  in  favor  of  certain  producers,  or  in 
favor  of  production  in  certain  circumstances,  being  the  source' 
of  a  gain,  which,  though  not  called  rent  unless  paid  periodically 
by  one  person  to  another,  is  governed  by  laws  entirely  the  same 
with  it.  The  price  paid  for  a  differential  advantage  in  producing 
a  commodity,  cannot  enter  into  the  general  cost  of  production 
of  the  commodity. 

A  commodity  may,  no  doubt,  in  some  contingencies,  yield  a 
rent  even  under  the  most  disadvantageous  circumstances  of  its 
production;  but  only  when  it  is,  for  the  time,  in  the  condition 
of  those  commodities  which  are  absolutely  limited  in  supply, 
and  is  therefore  selling  at  a  scarcity  value;  which  never  is,  nor 
has  been,  nor  can  be,  a  permanent  condition  of  any  of  the  great 
rent-yielding  commodities:  unless  through  their  approaching 
exhaustion,  if  they  are  mineral  products  (coal,  for  example),  or 
through  an  increase  of  population,  continuing  after  a  further  in¬ 
crease  of  production  becomes  impossible;  a  contingency,  which 
the  almost  inevitable  progress  of  human  culture  and  improve¬ 
ment  in  the  long  interval  which  has  first  to  elapse,  forbids  us  to 
consider  as  probable. 


Date  Due 


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